The sketchbook folder is the default location to save your sketches in the Arduino IDE, and can be found on the Preferences screen.
It defaults to My Documents\Arduino.
In Visual Micro this can be changed for each configured IDE from the IDE Locations Window, allowing your e.g. Energia Sketches to remain seperate to your standard Arduino Sketches.
The Sketchbook location also affects user installed libraries and custom hardware shown below.
The sketchbook\libraries folder is the default location where libraries are installed to from the Arduino IDE.
This is the same in Visual Micro, and libraries can also be manually installed from outside the IDE into this folder.
The sketchbook\hardware folder allows additional board packages to be added.
This allows manual installation of cores, and custom board configurations to be added alongside the cores installed via the IDE.