Kelly gave you a nice list of the "accepted" method of using the pairs. I live in a house that was built in the late '20s, and all phone jacks are wired using 2-pair IW (grey inside wire).
What I had to do, when I hooked up my DSL, is to plug a splitter into the jack where the Cable Modem was going. The DSL cord went into the splitter directly, and the phone had to have a filter plugged into the splitter and the phone cord plugged into the splitter. And any phones in the rest of the house had to be plugged into filters, before going into the jack.
DSL uses a lower portion of the bandwidth, and voice is raised to a higher portion of the bandwidth, using the same pair of wires from the Central Office. The filter lowers the voice signal to a level where the phone can "see" it.
Back in the day, when we had an install in an area with bad cable, we would install a unit on the pole that would split 1 CO pair into two voice lines. Inside the house, another unit would lower the "piggy-backed" signal to usable levels.
Also, David, if your home was pre-wired with 5-pair, AND someone previously had an old "Princess" or "Trimline" phone, the second pair was always designated for a 12 volt transmitter that supplied power for the dial lights on those phones. That could be a problem in getting the DSL going.
My home has 2 phone lines, so my NIU "demarc" has 2 drops from the pole. If you only have one drop, you absolutely need a splitter where the phone and cable modem are plugged in.
