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The following information is based upon the 2Wire having a LAN IP address of 192.168.1.254
The 2Wire needs to manage the PPPoE session.
Change the 2Wire's LAN subnet mask to 255.255.0.0
The Router's wan port will need to be put in DMZ Plus mode from within the 2Wire GUI.
The 2Wire DMZ Plus mode will DHCP the wan IP address to the router's wan port.
Be sure to submit any changes made on the 2Wire GUI pages to save the changes.
The changes to the 2Wire's configuration can be done from the 2Wire Management and Diagnostic Console:
Or use the LAN IP address of the 2Wire
2Wire example GUI Pages:
2Wire local network page
DMZ Plus mode page
The routers LAN IP address should not be 192.168.1.254 that is the 2Wire's IP address
You may need to change the router LAN IP scheme just avoid using the 192.168.1.X subnet
The LAN subnet mask of 255.255.255.0 for router's LAN
The wan / internet port of the router must be set for DHCP