Windows is your operating system as in "System Software". Some systems have Bluetooth enabled in them. Here Bluetooth is a system software of the computer. If you want to be clever, you could say your BIOS, or DOS or Linux.
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Device drivers and firmware(Example: Bios).Operating system(Example: Windows).Servers.Software development tools.Utility software.
In my limited capacity with working with different software packages I view system software as drivers that gets your computer up and running whereas application software is installed to perform needed tasks such as article spinning, fixing system errors or monitoring your system for ad-ware, hackers or virus's. But whatever the case both system software and application software should be made to be compatible with one another.
An operating system is the software that bridges the gap between the system and the user.Utility software performs actions essential for protecting, guiding, securing, and storing information or data appropriately in the system.Application software manages specific actions, for example, browsers, word processors, etc.
A computer system is a combination of hardware and software. It is designed for computing.
Both are software, operating system is software that will make your computer boot up and run. while Application software is a program that will run on a functional operating system.