From my understanding of your problem, I gather that you want to read an arbitrary number of lines from a text file and each line is a file path.
I think you are confusing your self a bit by first reading the file line-by-line and then try to split it further.
Input File
C:\receiveddata\d1.html<CR><LF>
C:\receiveddata\d2.html<CR><LF>
C:\displaydata\d1.html<CR><LF>
C:\displaydata\d2.html<CR><LF>
You don't need a specific separator character, because you already have a Carriage Return and a Line Feed at the end of each line, although invisible in the regular text editor.
The next step is to read the lines.
System.IO.File.ReadAllLines[
^] was kind of made for this task.
So basically all you have to do is this:
Dim filePath As String
For Each filePath In File.ReadAllLines("C:\Setup\Setup.txt")
Next