I do not believe there is a Win32 API to calculate the space consumed by a directory, although I stand to be corrected on this. If there were then I would assume Explorer would use it. If you get the Properties of a large directory in Explorer, the time it takes to give you the folder size is proportional to the number of files/sub-directories it contains.
Your routine seems fairly neat & simple. Bear in mind that you are calculating the sum of the file lengths, not the actual space consumed on the disk. Space consumed by wasted space at the end of clusters, file streams etc, are being ignored.