Okay there are a couple of wrong doings here.
1. You don't need to set your environment variables for chromedriver.exe. This is an executable.
2. The reason for your error is because you have to provide the path to chromedriver.exe in your code. Do it using System.setProperty().
3. And if your doing it using Elipse IDE, then remember that your path to chromedriver.exe will have to double slashes everywhere and not single slashes which is how usually the path is.
Below code is how you should do it.
System.setProperty("webdriver.chrome.driver", "C:\\Users\\michael\\Downloads\\chromedriver_win32.exe");
WebDriver driver = new ChromeDriver();