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What is the ideal method for creating a Windows application and service package?

I have a project I am working on where I need to create an app and service package for Windows. I would like the service process to run as SYSTEM or LOCALSYSTEM so that credentials are irrelevant. The application frontend will be installed and executable by any user on the machine. Data from the frontend application will be passed to the service - most likely paths to directories selected by users. Once started the service will listen for a command to do some action while accepting the aforementioned paths.
I'm using C# on the .NET platform and I've looked into creating a standalone service and a standalone application separately as well as creating a WCF service library and host application - that's as far as I've gotten.
All of these methods seem overly complex for what I am trying to achieve. What is modern convention when attempting something like this? I'm willing and able to learn the best method for moving forward.
Edit: This was flagged duplicate. I'm not looking for information on HOW to communicate with a Windows service. That's remedial and not at all what I'm asking. I'm looking for validation that I'm on the right track and if I'm not, I'm looking for suggestions. I've been told that I'm on the right track and pointed towards named pipe binding.

Windows Service is certainly an option for hosting WCF, although it kind of is a deployment nightmare. It really depends on your environment and the capability and support of your system admins as I've had many clients where deploying a windows service, as you need admin rights to install and update it, was simply not practical.
Console applications may sound like a terrible idea but the practicality of being able to drop them on a share and run a powershell script to start them is very compelling.
But frankly IIS hosting has the most advantages in my mind as the product is designed for ease of deployment and up time. And you can use any transport binding in IIS that you can use in a Windows Service or Console.
As for the binding itself named pipe is not really a popular option in many enterprise scenarios as it is incompatible with anything but .NET. Although the same can be said for binary which is one of the more performant bindings. The WSHttpBinding is probably the most popular binding in scenarios that require unknown callers. WebHttpBinding is an interesting option as its HTTP/REST based, although that requires further decoration of your operations and honestly if your going that route you should really be using Web API.

Embedded C# web server with easy SSL support

I am looking for an embedded Web Server with out of the box SSL support, preferably configured from a command line or some easy config, without the need to change system wide config (like Registry). It should also work on mono.

Have you tried my old server http://webserver.codeplex.com? It supports SSL and at least used to run on MONO.
I'm also (slowly) building a new one, it got no SSL support yet (but's not that hard to implement by yourself): http://github.com/jgauffin/griffin.webserver
Edit
The HttpListener in Griffin.Framework have SSL support now

I recently came across two such packages.
ceenhttpd - https://github.com/kenkendk/ceenhttpd
and
uHttpSharp - https://github.com/Code-Sharp/uHttpSharp
The part i like about these is that both of them let you load a certificate file from disk. If you use the raw HtttpListener, that is a pain.
If you are open to use .NET Core, you can also self-host Kesterel. I plan to use this as soon as I convert my projects to .NET 5. here is a small sample code for that.

How to build a ftp server

I'd like to build an home FTP SERVER - that will store all my files and the rest of my computers will upload and download files to and from it.
I don't like to start from scratch, do you know of a c# ftp server implementation?
Can you give me some guidelines of where to start what I should know etc?

Based on a few of your comments why do you not just enable the FTP server through IIS on one of your computers in your network, or just enable file sharing? These things are already partof/included in Windows at your disposal.

You say you don't want to start from scratch, so use something that's already been through the pain: http://filezilla-project.org/

The FTP RFCs for the protocol specification and the System.Net.Sockets namespace.
And read as much as you can on security (mailing list, bulletins, books, ...) because you can very easily leave holes for anyone to get to your files.
(I don't know of any FTP libraries beyond what .NET includes (I've not needed any FTP), but there are also third party networking component libraries that may include richer functionality. You'll likely still need to understand what's going on for debugging.)

You first need to understand the protocol: RFC959
Here a basic server in C#: http://www.c-sharpcorner.com/UploadFile/ivar/FTPServer12072005041005AM/FTPServer.aspx
Read on security...

Is it possible to create a standalone, C# web service deployed as an EXE or Windows service?

Is it possible to create a C# EXE or Windows Service that can process Web Service requests? Obviously, some sort of embedded, probably limited, web server would have to be part of the EXE/service. The EXE/service would not have to rely on IIS being installed. Preferably, the embedded web service could handle HTTPS/SSL type connections.
The scenario is this: customer wants to install a small agent (a windows service) on their corporate machines. The agent would have two primary tasks: 1) monitor the system over time and gather certain pieces of data and 2) respond to web service requests (SOAP -v- REST is still be haggled about) for data gathering or system change purposes. The customer likes the idea of web service APIs so that any number of clients (in any language) can be written to tap into the various agents running on the corporate machines. They want the installation to be relatively painless (install .NET, some assemblies, a service, modify the Windows firewall, start the service) without requiring IIS to be installed and configured.
I know that I can do this with Delphi. But the customer would prefer to have this done in C# if possible.
Any suggestions?

Yes, it's possible, you may want to have a look at WCF and Self Hosting.

Yes, it is possible (and fairly easy).
Here is a CodeProject article showing how to make a basic HTTP server in C#. This could easily be put in a standalone EXE or service, and used as a web service.

One technology you might want to check out is WCF. WCF can be a bit of a pain to get into but there's a great screencast over at DNRTV by Keith Elder that shows how to get started with WCF in a very simple fashion.
http://www.dnrtv.com/default.aspx?showNum=135

You could take a look at HttpListener in the .Net framework.

I would highly recommend WCF. It would fit very well into a product like you are describing. There are a good number of books available.

Sure, you can do that. Be sure to change the Output Type of the project to Console Application. Then, in your Main function, add a string[] parameter. Off of some switch that you receive on the command line, you can branch to ServiceBase.Run to run as a Windows Service or branch to some other code to run a console application.

This question is somewhat older but since I needed something similar some time ago it felt like this question is still relevant.
I wrote a small Rest-API with NancyFx and OWIN. OWIN is a standard interface between .Net applications and web servers. With OWIN it is possible to create a self-hosted WEB-API. Nancy on the other hand is
a lightweight, low-ceremony, framework for building HTTP based
services on .NET ¹
The combination of those two makes it possible to create a self-hosted C# Web service.
I am quite sure that there are many more possibilities to create something like this by now but since I used it like this I thought the Information might be useful to someone.

Embedded Web Server in .NET

I would like to embed a light weight web server in a Windows application developed in .NET. The web server has to support PHP.
I have looked at Cassini, but it seems it is ASP.NET only.

The .net class HttpListener exposes the underlying http.sys upon which IIS is built. All machines since Windows XP2 have http.sys installed by default.
Here are some links to get you started.
XML-RPC SERVER USING HTTPLISTENER
HttpListener For Dummies
As for the PHP support, I don't know how you would enable this, but there is no technical reason you couldn't build it in.

I would look at the likes of XAMPP Lite which you could easily start up and shutdown with your application.
There is also AppWeb which claims to be exactly what you are looking for.

You can always use PHP as a CGI application. CGI is well documented, and AFAIK pretty easy to implement. Use Darrel Millers suggestion, and couple it with some CGI magick, and you should be cooking with gas.

Mongoose embedded webserver
https://code.google.com/p/mongoose/
You can build it with VS2012/10/08 as EXE and you can use PHP and also websockets to push data to the client app. Also you can build a DLL you can do this with make or bring the code into a VS DLL project and build out a _DLLMain, DEF file, etc. Then use it direct from C# - see the mongoose.cs and example.cs files.