Because the query in this request aren't standard i.e. the first parameter doesn't have a variable name only the folder path, you can't get the URI query param in a reliable way. The following code will provide the functionality you want, but perhaps using a simple String.split() looking for the regex of folder would be more reliable.
Uri temp = new Uri("http://localhost/ReportServer/Reserved.ReportServer?/Report+Project1&rs:Command=ListChildren");
string query = temp.Query;
var folder = HttpUtility.ParseQueryString(query).Get(null);
Where the null value is in the Get method, you should really provide the variable name, in your example putting rs:Command
there would return the value of that param.