WINEARCH=win32 creates a 32bit prefix, to confirm check if
$WINEPREFIX/drive_c/Program Files (x86) exists
A wine prefix is a directory containing a lot of the files wine needs to simulate a windows installation. The "standard" wine prefix
~/.wine is used whenever you don't specify a different one in the environment variable
Now like a normal windows installation, the environment (e.g. the provided libraries) may be of either 32 or 64-bitness. Wine copies these libraries into the prefix when it is created, so you have to specify the desired bitness at that point, using the
$WINEARCH environment variable. To create a 32bit prefix, just execute wine with
$WINEPREFIX set, e.g.
WINEARCH=win32 WINEPREFIX=~/.wine_32bit winecfg
Finally, to check what bitness a given prefix has, just check if there is a directory
drive_c/Program Files (x86) in the prefix - if there is, it's a 64bit prefix.