To get one thing clear to begin with, there's only one Settings. When you bind application settings in the designer you're using the same setting as you would be if you used My.Settings in code.

Now, as far as saving the contents of a ListBox, I would suggest that you use a StringCollection in your Settings. You can bind that directly to your ListBox in code if you want. That said, if the list is changing then I'd suggest that you create BindingList from the StringCollection first, then bind the BindingList to the ListBox. You can then add, edit and remove items in the list and, at shutdown, copy the list contents of the BindingList back to the StringCollection for saving. There's no need for you to explicitly save the StringCollection because it will be saved automatically at shutdown, along with all your other settings.
vb.net Code:
  1. Imports System.ComponentModel
  2. Imports System.Collections.Specialized
  3.  
  4. Public Class Form1
  5.  
  6.     Private listItems As New BindingList(Of String)
  7.  
  8.     Private Sub Form1_Load(ByVal sender As System.Object, ByVal e As System.EventArgs) Handles MyBase.Load
  9.         'Create the settings collection on the first run.
  10.         If My.Settings.ListItems Is Nothing Then
  11.             My.Settings.ListItems = New StringCollection
  12.         End If
  13.  
  14.         'Load the data from the settings.
  15.         For Each listItem As String In My.Settings.ListItems
  16.             Me.listItems.Add(listItem)
  17.         Next
  18.  
  19.         'Display the data.
  20.         Me.ListBox1.DataSource = Me.listItems
  21.     End Sub
  22.  
  23.     Private Sub Button1_Click(ByVal sender As System.Object, ByVal e As System.EventArgs) Handles Button1.Click
  24.         'Add a new item.
  25.         Me.listItems.Add(Me.TextBox1.Text)
  26.         Me.listItems.ResetItem(Me.listItems.Count - 1)
  27.     End Sub
  28.  
  29.     Private Sub Button2_Click(ByVal sender As System.Object, ByVal e As System.EventArgs) Handles Button2.Click
  30.         If Me.ListBox1.SelectedItem IsNot Nothing Then
  31.             'Edit the current item.
  32.             Me.listItems(Me.ListBox1.SelectedIndex) = Me.TextBox1.Text
  33.             Me.listItems.ResetItem(Me.ListBox1.SelectedIndex)
  34.         End If
  35.     End Sub
  36.  
  37.     Private Sub Button3_Click(ByVal sender As System.Object, ByVal e As System.EventArgs) Handles Button3.Click
  38.         If Me.ListBox1.SelectedItem IsNot Nothing Then
  39.             'Delete the current item.
  40.             Me.listItems.RemoveAt(Me.ListBox1.SelectedIndex)
  41.             Me.listItems.ResetItem(Me.ListBox1.SelectedIndex)
  42.         End If
  43.     End Sub
  44.  
  45.     Private Sub Form1_FormClosed(ByVal sender As Object, ByVal e As System.Windows.Forms.FormClosedEventArgs) Handles Me.FormClosed
  46.         'Clear the old data.
  47.         My.Settings.ListItems.Clear()
  48.  
  49.         'Save the current data.
  50.         For Each listItem As String In Me.listItems
  51.             My.Settings.ListItems.Add(listItem)
  52.         Next
  53.     End Sub
  54.  
  55. End Class