Router problem, mixed with some xbox dns problem, and a tad of att dsl problem?.....?

My internet worked fine untill today. I had 2 phone lines, one for the internet/my room, and one for the house. we got rid of the one for my room and ran the internet to the line we have left now. when i plugged it in and started using it, it was acting weird. it has been working on and off and acting crazy. i have been talking on the phone all day now and have got nothing else done between att, linksys, and xbox. they all blame it on my router, but in order for them to tell me how to fix it, i need to extend my warrenty, $32.99 worth of extending. I have reset the modem and router, i have tried damn near everything. when i was running it thru my router, only the computer would work on the internet, and my xbox live would stop at dns. now nothing works. xbox says i need to open the ports on my router and gave me some numbers to put it, but idk how to do that. i mean i have been on the router ip page but im lost. please help me get this working. router is model BEFSR41 v3.
ok i forgot to put the filter back on, so im going to reset everything and try that.

to the first answer
-i already have been using dsl for my xbox and computer for months now. all these things have been working fine so thats why i dont understand why just moving the one end of my telephone cable from one jack to the other mad my router start acting up.

so maybe this filter was the issue.

to the second answer
-thank you very much for the help, im trying all the things you said


thank you both for taking the time to deal with this stupid issue.

my only other question is, im looking to get a laptop here in a month or so for college. if i get a wireless router, can i still hard wire my desktop and xbox into it? im assuming even though its wireless it still has ports. also what kind of things do i wanna look for in routers that makes one better than the next? thanks, please suggest me some good routers.
im trying not to make this too confusing but i figured i should add this. at first when i had my router hooked, i had the xbox wire, computer wire, and modem wire, all in the ports. this was the only way the internet would work, but my xbox would fail at dns. the my cousin came over and help me. we hooked it up right, and reset it and the xbox connected fully and the internet too. but the internet would pop up error 678. and it would stay connected for a while as long as we left the error box up. then randomly, it stopped working like that, and now the only way for me to get on the internet is to bypass the router, and go directly from my modem to my computer.