There are a few working on plunger designs including myself gyom and I might be able to help with some information.
The original Mot-ion plunger was an infrared distance sensor similar to what you are trying to make but the sensor and receiver were installed at the end of the plunger, using the tip of the plunger to bounce the infrared signal back to the receiver. As most will tell you this was less than reliable. They have redone the design with either a LVDT type of sensor or a hall effect sensor. I have not had the chance to have a good look at the new design to ascertain which it is.
I have tried with ultrasonic’s, IR sensors and home made LVDT's with mixed results. LVDT is going to be the most accurate type of linear sensor that could be done, but implementing is the difficult part as my goal is to design something that people could make at home themselves. Ultrasonics polling rate is too slow to pick up quick motion on the plunger when it is released and infrared was reasonably accurate, but came with the same problems that the Mot-ion plunger had; calibration errors, unreliable action, etc.
If you are looking to do a simple switch rather than analouge, a small induction sensor would be the easiest way.
As for converting the input to something VP can understand, I recommend starting with the teensy USB board. You can configure it to act as a gamepad so an analogue signal will work as a plunger on the Z axis with just a little calibration. VP will recognize it and work straight away. If you are looking to just do a simple switch, the teensy can act as a keyboard and be configured as the enter key.
Good luck with your design. Hope this info helps.