1 and 3. What it's actually being used for is this - In the course of my work, I've got to login to a bunch of different servers under a bunch of different ids - sometimes my own, sometimes an anonymous id. So what this application does is provide a menu of servers to login into - which saves me from having to type a lot or set up/remember a bunch of aliases. After selecting a number, the application calls (with exec()), "rlogin <server_name> -l <user_id>". Here's what the code looks like with the implementation of tye's suggestion (I had to made one minor change in the regex - '@\$' instead of '@$'. With the original one, I was getting '${$user_value}' instead of '{user_value}').

#######################################################
# Setup variables and packages
#######################################################
my $user = $ENV{USER};
my %servernames = ();
my $i = 1;

#######################################################
# MAIN
#######################################################
open(CONFIG, "<lgn.config");
chomp(my @lines = <CONFIG>);
close CONFIG;

foreach my $line(@lines) {
        # Add the -l between "server user_name" pattern in $line
        $line =~ s/\s/ \-l /;
        # Interpolate the value for "$" values
        $line =~ s/([@\$]\w[\w\[\]{}']+)/'"'.$1.'"'/gee;
        $servernames{"$i"} = $line;
        $i++
}


print "***Log in****\n";
print "Select the number of a server and user name combination\n";

foreach my $key(sort{ $a <=> $b }(keys %servernames)) {
        print "\($key\) $servernames{$key}\n";
}
print ": ";
chomp(my $ans = <STDIN>);

if (($ans eq "") || ($ans =~ m/\D+/g)) {
        die "Please specify a number\n";
}
if (defined($servernames{$ans})) {
        my $rlogin = "rlogin $servernames{$ans}";
        print qq(Executing "$rlogin"\n);
        exec("$rlogin");
} else {
        die "Please specify a valid number\n";
}
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The config file (lgn.config) would look like:

server1 foo
server2 $user
server2 foo
server3 $user
[download]

etc. Thanks to everyone for their help and suggestions....