I am using docker toolbox on Windows 7 to run docker. (docker version 1.9.1)
As it turns out, the docker machine creates its VM at C:\\Users\\username\\.docker\\mach
I found lots of these answers were out of data, at least they did not work in my environment: win10 PRO, docker desktop community 2.0.0.3. Finally, I resolved this problem by this method:
uninstall docker
open Hyper-V manager (press WIN key and then enter "Hyper")
Change the default virtual hard disk locations in the Hyper-V settings (not on the VM settings) and confirm
install docker
check the disk image location in advanced options of docker settings