Well there are a few things to check to be sure Iphone won't work
I dont have one so can't help much there
First off more information is required to assist you such as the name of your ISP
the make and model of your modem and router
secondly why cant you just shut off your laptop or PC and put your iphone in that slot
third it should not matter whether the iphone supports ppoe or not I am sure there are many
people in the world that have there iphone working fine and are barley aware that their router is ppoe
ppoe applies to the log in of the router once the router is logged in it provides service to devices by 'routing'
So you need to log in to your router and go through all the settings and see what you can find
I would suggest making sure the box for dhcp is checked and I would try opening a port for the phone
find your router in the list here and follow the steps >>>>PortForward.com - Port Forwarding Guides Listed by Manufacturer and Model
do you know how to log in into your router ???
I don't think your ISP can limit the number of devices allowed to connect and if they did
I don't know why you can't log in and manually allow all devices
I'm sure you can figure it out with a little persistence