question does proximity to the or a direct line to the exchange affect the speed, and if so how much. I am a scalper and every milisecond counts so if i were to trade remote from say california on a dsl or fios or whatever the ebst i can get would there be any delays?
Shared lines are going to have increased latency compared to, say, a dedicated T1. Also note that light travels just 186 miles in a millisecond, and nothing travels faster than light. If every millisecond really counts for you and you want to remain in California, rent a computer colocated with the stock or futures exchange and use an automated trading system.
I also have AT&T's DSL and I was having similar problems for years. On a fluke I bought a newer model of the original SpeedStream modem AT&T gave me (found on ebay) and that solved it. The newer ones do a lot better job at filtering noise, error correcting, etc. I have not had to power-cycle the modem since I bought it. Before that was at least a once-a-week occurrence. Highly recommended if your DSL modem is an older model.
Both max speed and reliability of DSL depend on your distance to the DSLAM in the exchange. Here in Aus I have 20Mbps ADSL2+ and it is very reliable, but I am fairly close to the exchange. If you are having to reset your DSL modem, it is a good sign that you have a poor signal to noise ratio on your line. That may be just distance, but may also be due to poor connections or other line faults. You can check your S/R ratio by logging onto your modem/router using any browser and taking a look at the statistics. Then a bit of googling will tell you if what you see is reasonable, and sufficient for a reliable service. Also, if you have a telephone service on the line and can hear noise, then all is probably not right. If you have evidence of poor line quality, complain to your provider, though in my experience sometimes getting a tech to come out is like pulling teeth. I would go further to suggest that if you can manage it, talk to the techs that are actually responsible for lines as they do in general know what they are doing in contrast to what is laughingly known as internet technical support in call centres.
You should be more interested in latency than speed. And yes, distance does affect latency. You can get a measure of latency by doing a "ping" to your broker. Then add some more latency for broker to exchange, processing time to check that you are within margin limits etc etc.