You still need "nc" or equiv even if you're telneting from the local host; there is no such thing as "using telnet to the local serial port" without intermediate software. If you want the "telnet server" to behave just like an Xport, so you can't tell the difference between connecting when the arduino is connected locally vs when it is connected via the xport, you probably have a bit of work to do on the unix telnet server SW.