print is showing non printable characters

[Gribouillis]

What am I doing wrong?

You're not doing anything wrong. It is the way python prints bytes objects

>>> x = b'foo bar'
>>> print(x)
b'foo bar'

You can use the decode() method, without argument if the bytes string is encoded in utf8

>>> print(x.decode())
foo bar

Starting with python 3.7, an alternative is to use text=True in the call to subprocess.run(). Before that, you can use universal_newlines=True. Then the output will be a str instance instead of a bytes. Starting with python 3.6, you can use encoding='utf8' or another encoding value.

output = subprocess.run(['dir'], stdout=subprocess.PIPE, text=True)

also you don't need shell=True. Use a list as first argument of run().