Description of the lab:
I need to build a standalone RAS server (using Fedora 6 in this case) that I'd connect to from a windows XP client using a dialup connection. So the windows client would initiate a PPP connection over the modem, and receive an IP address back that it would then use to communicate to the RAS server over TCP/IP.

Description of the problem:
The problem is I have only one telephone line. I have the test server set up listening on that line (using mgetty); but don't have another phone line to dial out of (from the client).

I'd be most grateful for suggestions for a suitable dev/test environment for this scenario.

I'm not sure that I understand the problem; why do you need two phones lines? Certainly the RAS server has a better connection to the Internet than dialup?

Actually the purpose of this server would be out-of-band access to internal networks in case of emergencies like firewall outage, etc.

That still doesn't explain the two phone lines. If you are trying to dial into the internal network, you just need the one line to receive the connection from the client machine.