[Update Nov 2023: Windows PowerToys has a new module for Windows Environment Variable management, see below.]

It is possible to set Configuration variables as Windows Environment Variables. This can be useful in some cases. They should generally be set at the User level, not System level. Use of this method is usually applicable to administrators, but may also be relevant to wider groups of users.

It is suitable for certain variables that one might wish to apply to all installed MicroStation based applications, as demonstrated in CONNECT Edition - Configuration Tips: ProjectWise Integration,

Two useful variables for administrators are 

• _USTN_DISPLAYALLCFGVARS, this displays system variables in the Configuration variables dialog, essential for configuration analysis and troubleshooting, enable by setting it to '1'.
• The Ribbon includes an Admin Workflow. This is hidden by default but can be enabled by adding the Capability CAPABILITY_UI_ALWAYSSHOWADMINWORKFLOW
  to do this:
  Click New under User variables, then enter the variable name _USTN_CAPABILITY and value +CAPABILITY_UI_ALWAYSSHOWADMINWORKFLOW. The result is shown below in the Edit dialog (which is identical to the New dialog):
  
  
  
• To enter multiple capability switches, add then to the variable value separated by a semi-colon with no spaces, e.g.:
  +CAPABILITY_UI_ALWAYSSHOWADMINWORKFLOW;-CAPABILITY_LEVELS_NUMBERS

For both users and administrators, particularly when multiple products are involved, another possibility is (for very specific cases!) delivering a DGNLIB to all applications. in Using It! - Add Frequent Tools or Places to the Quick Access Toolbar I showed a couple of useful menus that I wanted to see in all my applications (they are application neutral, pointers to common tools or places). 

I added a folder DGNLIB_GUI to my OneDrive for Business, then pointed MS_GUIDGNLIBLIST to it using the standard Windows environment variable OneDriveCommercial. That way I can use the same DGNLIB on any machine I log into once the Windows User Variable is added (that can be scripted on managed networks, and could point to a common network share, in my case OneDrive was more convenient).

Windows PowerToys Environment Variables Manager

Microsoft PowerToys latest update has a new module for managing Windows Evironment variables. 

If like me you have PW_DISABLE_INTEGRATION_FROM_DESKTOP = 1 set as a Windows variable to stop the ProjectWise login dialog from popping up all the time, but sometimes need to have PW integration available this tool will be useful.

Editing this variable via the Windows dialog takes quite a few clicks.

This Powertoy has the ability to make this easier by creating profiles that load additional variables (although only it seems that only one additional profile can be turned on at a time).

I've added a profile that toggles PW_DISABLE_INTEGRATION_FROM_DESKTOP:

[Update Jan 2024]

In MicroStation 2023 (this may require 2023.1 or later) we can specify the location of configuration.xml using MS_CONFIGURATIONXML_PATH via a Windows Environment Variable. Note that as this power toy only allows one profile to be active at once you will need to add multiple variables to a profile.