Really. I don't know what the problem is except that you don't understand how they are supposed to work.
It's like Jeff says and when the plug is inserted the CO line is looped through the alarm panel then back out to the premises. If the plug is removed there are jumper bars that are part of the jack that connect the CO line directly to the premises to maintain service.
You can plug a regular line cord with a phone or butt set into the jack and get dial tone since the CO line is on the usual pins 4&5. This is one way to test.
When the alarm panel goes into alarm it disconnects the premises wiring and connects to the CO line to dial out. When that happens any call in progress will be disconnected and the line will go dead. This is another piece of information to keep in mind if troubleshooting a dead line. If you have DT at the jack but the phones are dead suspect that the dialer may be hung up. Pulling the plug out of the jack putting it in bypass will confirm.
Also, since the RJ31x is an 8 pin jack and the pre-made alarm cords are 8 conductor some alarm installers will jumper two of the unused pins on the jack and connect the corresponding wires from the line cord to a tamper zone on the panel. This will give an immediate indication to the panel that the plug has been removed and depending on how it's set up may just indicate a trouble or cause the panel to go into alarm. So keep that in mind before pulling the plug. You don't want the cops showing up.
-Hal
