Ok, I had a similar issue and ignoring all security complications and the like, wanted to TELNET from a VB initiated connection to a remote device and do stuff. I concur that the whole negotiation process is a hellish thing to do but once you've worked it out it's actually pretty simple to implement. I decided not to stop because I kept reading things that said it couldn't be done when it clearly can be done if you can write and read 1's and 0's into/from a network stream.
The code in the link below will initiate the connection and get you through to actually exchanging clear text information over TELNET. Given the example of sending a username and password combo shows how to read and write to the connection.
Big tips - initially have a nice big textbox or something to trap everything that comes into the buffer (variable returndata). This will help you diagnose problems. Also check on my blog there how to do this without the textbox blinking like a flashing thing. Once you've done all that and you know your script is reliable, trun off any screen updates and it will whizz through rather than take an age.
Apologies for the really dirty code and the crappy website layout.
http://myhead-online.blogspot.com/2009/05/vb-net2008-express-telnet-to-sun.html