The easiest manner in which to open delimited files with Monarch (Pro) is by treating them as a database source, not as a conventional report. I think of reports as structured, or formatted, text files.
The model is the way that you teach Monarch about the data source, with templates and such. Project files are a convenience for you. When you create a project file, the full path names of both the data source(s) and the current model are stored in the project. Then, so long as the file names don't change, when you open the project file, Monarch will open the appropriate data source(s) - be it report file(s) or database or what have you - and will immediately apply the necessary model file.
Projects have the added benefit of being able to store a series of pre-defined exports for subsequent re-use so that you don't need to configure the exports that you need from scratch every time. Here's [URL="http://********************/xlreport/how-monarch-makes-quick-work-of-long-term-improvements"]an example[/URL] of putting a project file to work for you.
Under your Options menu, select Export and Clipboard... item. On the Text Files tab you'll find options for the delimiter character. You can use any character that you want for the delimiter by selecting the "Other" option and supplying the character to use, inluding the tilde.
Think of a project as combining a specific instance of a report and a model. The model actually contains the parameters that extract the data. The report contains the data. The reason why projects are convenient is that you may have several similar (but not identical) versions of a report. When you develop a model for a particular version of a report, you want the two to remain associated, so that if you come back to the work later, you don't have to try the model on different reports to figure out which one it belongs with.
As for your second question, reports are usually text files, like what Monarch outputs. I usually think of the report as the text file that is inputted into Monarch so that it can extract data. I wouldn't refer to exported file as a report, but as a delimited text file.