The problem is that your .htaccess rules are referencing a path outside of the document root, which is not allowed in .htaccess files.
Here is the complete working code for your .htaccess file.
RewriteEngine On
RewriteBase /
RewriteRule ^index\.php$ - [L]
# add a trailing slash to /wp-admin
RewriteRule ^wp-admin$ wp-admin/ [R=301,L]
RewriteCond %{REQUEST_FILENAME} -f [OR]
RewriteCond %{REQUEST_FILENAME} -d
RewriteRule ^ - [L]
RewriteRule ^(wp-(content|admin|includes).*) /subfolder/$1 [L]
RewriteRule ^(.*\.php)$ /subfolder/$1 [L]
RewriteRule . index.php [L]
The code in your wp-config.php file is correct and therefore requires no change.