I don't have experience of the LabVIEW telnet tools, but have some ideas that may help you.
Telnet is/was mainly used for transfer of text. As such it can "helpfully" convert "new line" from other systems to how a "new line" appears on your system. "New line" is often 0x0A on Unix. Other systems use 0x0D (Mac) or 0x0D0A (DOS/MS-Windows)
One option in the Unix telnet command is to convert incoming 0x0D characters to the two character sequence 0x0D0A. It looks like this conversion is what is happening for you (but it could be done be either by the telnet server on the Unix system or the telnet client in LabVIEW).
-- Extract from Unix man page for telnet ---
crmod Toggle carriage return mode. When this mode is enabled, most carriage return characters received from the remote host will be mapped into a carriage return followed by a line feed. This mode does not affect those characters typed by the user, only those received from the remote host. This mode is not very useful unless the remote host only sends carriage return, but never line feeds. The initial value for this toggle is FALSE.
--- End extract ---
So check the options with the LabVIEW telnet to see if it is doing the conversion, and also check the man page for your Unix telnet server (daemon). When you're sending binary data ypu will need to make sure that both send and receive ends have all their end of line conversion disabled. Of course this may cause other problems if you are changing what is received at the end of line and relying on what happened before.....
Good luck,
Rod.