Imho it could make sense to actually split your installation like I did, however it depends on your overall system.
I for example got three drives - one is an NVMe, two are SATA SSDs. I keep the MSFS executable on the NVMe as well as all default packages/world updates and items bought on Market Place.
The two SATA drives are configured to work as one drive (RAID 0) to speed them up by using these in parallel basically. I have all my community folder stuff which are not mods or liveries for default aircraft installed there using symbolic links - the type of link you can also create using Addon Linker.
Why would one do this? - This way I tried to utilize as many PCI Express lanes as possible when running MSFS because if the CPU can load data in parallel things may go a bit faster.
However as said before it all depends on your system. If your CPU is not the fastest around this is basically worth nothing as even if it would get data in parallel from your drives it would not be able to process it fast enough.
Anyway there is another benefit of splitting the installation: you can actually organize your packages better, especially if you use tons of addons from different stores or freeware products. In combination you can also move just your package folder (which includes the “official” and “community” folders) like @TenPatrol already told., but you don’t need to deal with the userCFG.opt file.
After moving the folders to your D:\ drive just hit up MSFS. It will ask you to download 120GB again. It won’t do that if you just point to the new location of your package files (e.g. D:\MSFS when “official” and “community” folders are now in there). After doing so MSFS will just check whatever is in this folder and load to the menu 
Semi official guide how to do this in detail: