Lines

You can't just draw a line. Instead you have to create a line in memory and then write it to the DGN file. So in a subroutine, first you set up a variable that will hold an element.

Dim oLine As LineElement

You also must define two Points and set the values in the X,Y, and Z directions:

Dim ptStart As Point3d
Dim ptEnd As Point3
ptStart.X = 10
ptStart.Y = 10
ptStart.Z = 0
ptEnd.X = ptStart.X
ptStart.Y = 20
ptEnd.Z = ptStart.Z

Then you create a line element and add it to the design file:

Set oLine = CreateLineElement2(Nothing, ptStart, ptEnd)
ActiveModelReference.AddElement MyLine

Line Characteristics

Some settings are pretty easy, able to be set by changing values of properties in ActiveSettings (color numbers are part of Microstation; 0 is white; 1 is blue; 3 is red). When you create a line, all of the ActiveSettings will be used, so to get what you want (instead of whatever the current ActiveSetting is) you need to set all of the characteristics you want:

ActiveSettings.Color = 0 
ActiveSettings.LineWeight = 3

But since there are an infinite number of levels and they are named, you can't change levels quite that easily. First you have to set up a Level variable, then you can assign a level to it by looking for the name of the level (by default, levels are named "Level 1," "Level 2," etc.)

Dim oLevel as Level
Set oLevel = ActiveDesignFile.Levels.Find("Level 2")
Set ActiveSettings.Level = oLevel

The Line Style (solid, dashed, centerline, etc.) is the same way as Levels. You have to set up a variable of the LineStyle type, then store the settings in it using Find and then set the ActiveSettings by using your variable. To set the active LineStyle to 2 you must do the following:

Dim oLineStyle As LineStyle
Set oLineStyle = ActiveDesignFile.LineStyles.Find("2")
Set ActiveSettings.LineStyle = oLineStyle

I set all of this up by making up a subroutine called LineSet, where I could enter a string representing the type of line I wanted and the subroutine would take care of all of the settings: