It may be a problem with the new version of VLC 2.x.x. (XP32, VS2008)
I had played with this a bit quite a while ago and had it working, but all I got with the newer version installed was a black box. I uninstalled VLC, and deleted the program directory and then installed the last 1.1 version and it works again now.
I have seen others claim that you can use either add or addtarget to load a playlist, but those posts are quite old. I have not had any success using those. Howeverthe playlist is just an XML document and it can be easily parsed to extract the filename. Then these filenames can be added to the player's playlist.
Dim doc As New Xml.XmlDocument()
Dim nsm As New Xml.XmlNamespaceManager(doc.NameTable)
Dim TrackLocations As Xml.XmlNodeList
TrackLocations = doc.SelectNodes("rootns:playlist/child::rootns:trackList/child::rootns:track/child::rootns:location", nsm)
If TrackLocations.Count > 0 Then
For Each location As Xml.XmlNode In TrackLocations