ITunes 10.2.1 Update has created 2 iTunes libraries

Have just updated to 10.2.1 and on checking finder there is an iTunes folder with all the music etc and another folder (iTunes new) which also has all the music etc. The folders are not identical as they are of different sizes but their structures are the same. iTunes is "looking at" the iTunes new folder. Is it OK to remove the other iTunes folder structure which would save me some 25GB of disk space?

This is a user to user support forum. Perhaps nobody who has read your post so far knows quite what to make of it and therefore what to suggest...
When you run iTunes what is the title of the window, "iTunes" or "iTunes New"? Do you know whether you are currently using the library files in the folder "iTunes" or iTunes New? If you hold down Option when starting iTunes you should get a dialog asking if you want to choose or create a new library. That dialog may also appear if the existing library file is corrupt? Did you accidentally create a new library when there was a problem?
Here is my usual suggestion for the empty/corrupt library that can occasionally follow an upgrade.
*Empty/corrupt library after upgrade/crash*
Hopefully it's not been too long since you last upgraded iTunes, in fact if you get an empty/incomplete library immediately after upgrading then with the following steps you shouldn't lose a thing or need to do any further housekeeping. In the *Previous iTunes Libraries* folder should be a number of dated iTunes Library files. Take the most recent of these and copy it into the iTunes folder. Rename *iTunes Library* as *iTunes Library (Empty)* and then rename the restored file as *iTunes Library*. Start iTunes. Should all be good, bar any recent additions to or deletions from your library.
See Music Folder Files Not Added and Super Remove Dead Tracks for clean-up tools, if required.
In your case it is not so clear what to suggest, however you if you are certain that the active library is not connected to anything in the older folder, and there is nothing you want to recover from it, then you should be OK to delete it. However the older version of your library may have other data such as play counts, date added values, playlists etc. that you could possibly recover using the techniques above. The choice is yours.
iTunes picks up the Window title from the folder holding the library files (I'm assuming the same is true for the Mac version as Windows) so if, once you've cleaned up, and I've guessed correctly, you might find that iTunes is displaying as "iTunes New". If so, close iTunes, rename the folder as "iTunes" then restart. It will either reconnect automatically or ask you to choose or create a library. Click choose and then browse to the renamed "iTunes" folder and open the library there.
tt2

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