Let's start by heading down the correct path…
You control the INTERNAL schema. You Own it, its yours. So, you map from the "interesting" input schema to your internal schema that you create that puts the data into a clean and manageable format, but only because it's a best practice and the right thing to do. Map your data in the Receive port and handle only the internal schema in your orchestration, if you need one (if not, then great…just use another map to the outbound schema.)
That said, I'd suggest as a starting point a concatenation of the <line> elements and then isolate the pattern that delineates the beginning and end of the data you care about.
Since I know I could break that data down using the FlatFile Schema Wizard, I'm sure there are methods to help you break it down. I'd probably start with string functoids, get frustrated and write a script, before searching BizTalkGurus.com and then Google.
Hope this helps, even a little bit.