That's not going to work.
I'm not at all sure what you expect it to do, but it's not going to do it.
for (int index = 0; index < lines.Length; index++)
string line = lines[index];
foreach (string s in lines)
line = s.Replace(path, newPath);
1) You loop through all lines
2) Inside that loop, if the string is found, you loop through all lines again
3) Inside that loop, you set the same variable to many different values.
4) You ignore the value you changed and write the original input out to the new file.
5) The path you output to isn't a file, but a folder.
Many things just look weird here: which probably means you leapt straight into code without thinking about what your task was and the best way to manage or implement it.
I'd strongly suggest that you start again: think about exactly what you need to do, and work out what the code flow should be before you start coding - because whatever your task is, that isn't a good solution!