IIS has nothing to do with SFTP.
Microsoft Win32-OpenSSH uses exclusively Windows local accounts. There are no SFTP-specific dedicated accounts like there are for FTP in IIS.
So create a new Windows local account.

Hello,
Newbie here. Windows Server 2022 with OpenSSH server freshly installed.

Previously (some years ago) I would set up an FTP site in IIS. Now I can't tell how to designate the folder I will land in when I connect to the server with WinSCP using SFTP/SSH.

I have not connected yet. I have WinSCP installed on Windows 10 Workstation.

To work on the server, I log on to the remote server using Remote Desktop as an administrator. However, I want to use a special account reserved just for SFTP/SSH when I connect through WinSCP.

Do I setup a target folder related to that account? It doesn't seem obvious how to do it in IIS like in the old days.

Thanks,
Kyle