The junction point is itself primarily for backwards compatibility. Vista changed the arrangement of folders and where special folders were. The short of it is that in XP the special folder was shared with a few other special folders, such that "Application Data" was available from that location, and so programs expected to be able to use <specialfolder>\Application Data but in Vista that folder no longer existed because the special folder was moved to it's own location. To fix compatibility problems, the junction point C:\ProgramData\Application Data was added which points back at C:\ProgramData to resolve that problem.
As for renaming it, The junction point has security permissions set on it. You'll want to first unset the Hidden and System attributes, then edit the security permissions in File Explorer to remove the deny entry denying everyone List contents/Read Data permissions. This should allow the rename to work, then you can add the security permission back and reset the hidden and system attributes.