To answer your questions:
I don't have a home phone, we each have wireless phones so I didn't install one because of telemarketing. I was only interested in the faster internet provided by two lines. The wire from the phone box is connected to the pole outside on one end and the Zyxel on the other.
No, I don't have an alarm system.
I left the settings that were pre configured by Sonic. There was a piece of tape on the Zyxel that had the key. But with the provided instructions from the post below yours I looked at the security tab and it lists this:
Network Authentication: WPS2-PSK
WPA Pre-Shared Key: ************
WPA Group Rekey Interval: 0
WPA Encryption: TKIP+AES
WEP Encryption: Disabled
Should that ^ be Enabled?