The final product is the same as the Windows msi installer.
It's just different how you got there. As for the old vdproj, there was nothing but setting up the files to be copied and the registry keys, as far as I remember. Anything else, and you will need to create a custom action in C ++ or VBS, and not especially if you are a .net developer.
However, with the advent of Wix, there are many more built-in user actions that allow you to create a rich installation experience, and if you need to create your own action, you can use .net. In addition, it is much easier to create a boot block that can install dependencies with your msi, as well as the ability to create an interface in WPF.
As @nvoigt said, the old vdproj type is not supported in VS2012, and it also cannot be built by the build server without any unpleasant configuration (you need to install VS).
In general, in fact, there should be no question of what to use, Wix is the way forward.
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