The DSL modem is, for all intents and purposes, a networking device. It has no relation to faxing.
Your iMac/eMac still has an internal modem, and it remains available for use even if you don't use it to connect to the Internet.
To set up the internal modem for faxing in Panther (Mac OS X 10.3), go to /Applications/Utilities/ and open Printer Setup Utility. Go to the View menu and choose "Show Fax list".
You should see Internal Modem. If you do, you're ready to go. (Well, obviously you must have the modem plugged into a phone line with a dial tone, of course.)
To send a fax, you just write your document in whatever program you want, press Print..., and then in print dialog, press the Fax... button. Type in the fax number, and away you go!
tooki