...love the expression about your modem...;-), but you can leave that alone. All it is doing is to convert the digital signal from your computer and router into a analog signal (telephone line).
The easiest way to set up port forwarding and open your NAT settings on the router is to go here
and find the correct model of your router in the list (Linksys is almost all the way down).
Skip the ad on the next page (link is in the upper right corner.)
In the right column you will find all settings for the Xbox, also Xbox live.
On the top of the page is a link for setting up a static IP address for your computer. The reason why you should do this, is that your router needs to know to which computer it has to forward. If your computer's IP changes all the time (DHCP = Dynamic Host Configuration Protocol), you might not be able to play.
If you have any more questions, just come back here and leave a comment - I'm happy to help.