Just found the following in the Chromium Code 
#if BUILDFLAG(IS_WIN)
// Some Windows specific directories to block, basically all apps, the
// operating system itself, as well as configuration data for apps.
{base::DIR_PROGRAM_FILES, nullptr, kBlockAllChildren},
{base::DIR_PROGRAM_FILESX86, nullptr, kBlockAllChildren},
{base::DIR_PROGRAM_FILES6432, nullptr, kBlockAllChildren},
{base::DIR_WINDOWS, nullptr, kBlockAllChildren},
{base::DIR_ROAMING_APP_DATA, nullptr, kBlockAllChildren},
{base::DIR_LOCAL_APP_DATA, nullptr, kBlockAllChildren},
{base::DIR_COMMON_APP_DATA, nullptr, kBlockAllChildren},
// Opening a file from an MTP device, such as a smartphone or a camera, is
// implemented by Windows as opening a file in the temporary internet files
// directory. To support that, allow opening files in that directory, but
// not whole directories.
{base::DIR_IE_INTERNET_CACHE, nullptr, kBlockNestedDirectories},
#endif
Those are the folders that Chrome considers to contain ‘system files’
Related: Chromium Bugs 
Not quire sure on the solution, other than trying a different location to choose from
Merging this topic here, considering the similarities and not being NMS specific