A detailed kinetic-theory model for the vibrationally state-resolved transport coefficients is developed taking into account the dependence of the collision cross section on the size of vibrationally excited molecule. Algorithms for the calculation of shear and bulk viscosity, thermal conductivity, thermal diffusion and diffusion coefficients for vibrational states are proposed. The transport coefficients are evaluated for single-component diatomic gases N₂, O₂, NO, H₂, Cl₂ in the wide range of temperature, and the effects of molecular diameters and the number of accounted states are discussed. The developed model is applied to study wave propagation in diatomic gases. For the case of initial Boltzmann distribution, the influence of vibrational excitation on the phase velocity and attenuation coefficient is found to be weak. We expect more significant effect in the case of initial thermal non-equilibrium, for instance in gases with optically pumped selected vibrational states.