Did this previously work? 
 
As stated in the Preferences the default programs are used when a file type does not already have a system file association. 
 
Typically .txt files already have a system file association so to use a custom program you need to create an override by adding a new File Association entry. 
 
From the main menu > Options > File Associations 
 
Add a new entry and add *.txt and select the program to use for view/edit and then click the OK button to add the entry.
		 
		
		
		
		
		
		
		
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