First let me say I only got the question right because I know someone that works at M$.

Second let me say that I have no idea if this question is still on the M$ database exams becuase it is so controverted.

The exam question used to be how do you set the default backup directory.

The correct answer was only during installation.

It was said the other "correct answers" were wrong becuase manual registry updates to change a policy settings was not supported.

Unfortunately it actualy can be done by updating the registry and with the FACETS management object for updating policy objects. Does not even have to be done in SSMS if you know how to call it from code.

Shame that M$ support does not properly document the Policy Update or FACETS utility.