I don't remember seeing this before.

Can someone please explain this to me.

My audio is set to ASIO, but when I look at the MIDI driver, it is set to MME with no other choices.

I'm guessing that's all MIDI needs, but i would love to hear an explanation?

Thanks!

This is correct. There is a new format now but haven't heard much about it. 
A lot of people misunderstand that MIDI is not part of your ASIO driver and is a different driver. 
 
Not sure if  this is related to MME mode as this is only using USB midi but: 
I find that controllers that come with  a (midi?) driver are more stable than those that use a generic driver. 
Example, my Akai keyboard is always disconnecting from Sonar. It uses generic drivers.
My Roland and Yamaha never do that. I can even turn them on and off with Sonar open and they re connect. They both came with a driver. 

The only reason you see a driver mode is several months ago a UWP mode was added for Win10. Prior to that, there was no driver mode option for MIDI. It was always MME.

@ scook. I'm curious as to whether there is any know latency (or typical range in ms) for window MIDI. Is there some typical value from when data is sent/received between a program and the physical midi ports ? 

Correct the default driver mode for MIDI is MME and has been that way for decades.
ASIO = Audio Stream I/O and is not related to MIDI.
We also support UWP MIDI which is the newest MIDI API for Windows.

Thanks Everybody!

I would have marked all as "answer" if the forum allowed, as you all added more to the explanation.

I only see MME as I am not win10 (win8.1 stuck here due to old gear)