Can I simply delete the File Entity folder from Modules if I am using Media 7.x-1.3
Do you have backups from before the 2.x version of File entity was installed? That would be the ideal solution because frankly, things are bad. You can't just remove the File entity 2.x module directory, because at this point the module has been installed and your data is at quite a dirty state. The only real solution is to try an in-UI disable/uninstall of File entity and any Media related modules to try and get your site to a more clean state before again installing and enabling the proper versions you need/want.