Ok, I think I did something stupid.

mysite.com is the current live site (non-DNN). I installed DNN on mysite.com/newfolder for Development and Testing. Now the DNN site is ready to replace the current site. How can I do this? I am actually looking for a way to get DNN site populate on visiting mysite.com instead of the old site without moving DNN files from mysite.com/newfolder to mysite.com root.

Let me know if I am confusing you with my words.

Thanks.

In  IIS settings for you site, change the home directory to mysite.com/newfolder and make sure to (first) add mysite.com as a Portal alias (under Site Settings in DNN app).

NOTE: If your development alias was mysite.com/newfolder, be prepared to fix all relative paths to images, pages and documents. (In that light, a much simpler way to develop and, then, publish site would be to use secondary domains, like dev.mysite.com - this way you won't have any issues with relative paths.)