Installing WP twice in same Directory?

Have you considered setting your main site to a multisite setup?

This would allow you to use the same wordpress files from the root and serve a wordpress site under the /seperatesite/ directory without the need for duplicating files.

take a look at: http://codex.wordpress.org/Create_A_Network

If you need any specific help regarding setting this up then feel free to make a new question.

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