There is a nice table in the cabal docs that explains how prefix gets used:

http://www.haskell.org/ghc/docs/7.0.4/html/Cabal/builders.html#simple-paths

For Vista and above C:\Documents and settings\myusername\ is
C:\Users\myusername.  The equivalent to $HOME on Windows would be
$USERPROFILE but the syntax of expanding an environment variable is
going to depend on the shell you are using:

cmd window:  cabal install --prefix=%USERPROFILE% --user
PowerShell:  cabal install --prefix=${env:USERPROFILE} --user
msys window:  cabal install --prefix=$USERPROFILE --user

Note that msys does define $HOME and it is a different physical path
than $USERPROFILE.