Usually lag on dial-up comes down to 3 things; the condition of the phone line, the setup for your modem, and network settings.
Shorten the distance between your computer and your Telephone Network Interface (TNI). This is the gray box (usually) on the outside of the building where the phone lines connect to your building's internal phone wiring. Find a phone jack that's close to that, and use a short (< 10 feet) phone cord to connect to your modem. Disconnect any and all other devices using the line that might add line noise, including other phones, fax machines, answering machines, satellite receivers (yes some of these do hook up to the phone line too), etc.
For the modem itself, visit the manufacturer's site, download and install the newest drivers and also flash with the newest firmware. I'd recommend that you take a look at the 56k.com site in their
Troubleshooting and
Help for slow connects sections. Your OS should let you adjust the rest of the settings for the modem, so do some experiments with them. Adjusting the port rate and compression methods can make a big difference.
Close or disable any programs and services that aren't essential. Disable your firewall while playing, or set it to not filter traffic from your client's executable, nor the port range(s) of the games you play.
Some of these might not apply, but here's some additional info on
Quake 3 Connection Tweaks. Adjust these values in the console (particulary rate and cl_maxpackets).
Good luck!
