How to add WinSxS assemblies into a MSI package?

If you need to install Win32 side by side assemblies globally, you should use the MsiAssembly and MsiAssemblyName tables to do so. Your InstallExecuteSequence table should also include the MsiPublishAssemblies and MsiUnpublishAssemblies standard actions. There is more information on these tables in MSDN and the sample sequence.msi package provided with the Windows Installer SDK (of the Windows SDK) provides a recommended sequence number for those standard actions.

You can refer this article to get the basics of Assemblies

A win32 assembly is an unmanaged assembly (native code). An assembly that is installed to the GAC is actually a managed assembly or otherwise known as a .NET assembly. While the concept of the assembly unit is the same, there are quite a few differences between the two. Typically .NET assemblies are contained within a single module that includes an embedded manifest. For Win32 assemblies, the manifest and catalog file are separate from the binary itself.

You can review the assembly structure yourself by taking a look at the following folders on a Windows Vista machine:

.NET assemblies

Win32 assemblies

A good starting point on MSDN is