A seguir faria
$x = ""; ("ABC\DSD\AAR" -split '\' | % {$x = "$($x)$($_)\"; $x -replace '\$', '$'}) -join " " -replace '\$$', '\*'
ou um pouco mais longwinded
$x = ""
("ABC\DSD\AAR" -split '\' |
Foreach-Object {
$x = "$($x)$($_)\"
$x -replace '\$', '$'
}
) -join " " -replace '\$$', '\*'