Installing a service tells win32 where to find the executable. The executable is actualle Perl. Therefore this $^X. The script that actually implements the service is a parameter to Perl. The code implements service.pl as the service controller: it is capable of installing, removing, starting etc. the script. Furthermore, service.pl is the service itself if it is invoked with the --run parmater. The code

parameters => ( sprintf '"e:/dia/temp/service.pl" --run', $scriptPath,
+ $script ),
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is actually misleading, because the path and script are hard-coded. Hence, you can write it as

parameters => '"e:/dia/temp/service.pl" --run'
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The start_type tells the win32 service manager to automatically start-up the script. This means, no user must be logged in. This latter thing is actually one of the main reasons to use services on win32.