You need to make the scratch directory before you run the dism command. If the drive you want to use for the scratch folder is E: then from a command prompt type:

MD E:\SCRATCH

Once you can boot into a working windows, use Disk Clean up and its 'clean up system files' button. That should fix it.

It depends on how you were determining the 'size' of WinSxS, File Explorer can be misleading ...
...

Open a Command prompt. Use DIR on each drive letter in order to identify what letter is being used for your Windows system drive. It is unlikely to be seen as C: when you are booting from a USB. In...

Yes, the MCT makes Creators Update media (1703). To get the Anniversary Update (1607) ISO direct from Microsoft, use Edge and go to the Download Windows 10 page where you would normally download the...

The DISM command can be run offline too, and may be able to repair things sfc cannot.

You'll need the install media for the same version of Windows (1703, 1607, etc.) as is installed on the PC you...

We are, I think, talking about Kyhi's rescue drive
Windows 10 Recovery Tools - Bootable Rescue Disk

Running disk cleanup from there will NOT clean up system files on you C: drive. That's because...

NO!!!!

https://docs.microsoft.com/en-us/windows-hardware/manufacture/desktop/determine-the-actual-size-of-the-winsxs-folder