I'd held off on posting this for a long time, and I'm not really sure why. To everyone who asked for random posts, this one's for you.
Whether it's so you can move room to room without fumbling with an mp3 player, so you can host awesome parties, or just to up your nerd cred, increasing numbers of people are interested in whole-home audio solutions. The problem is, they are very expensive. If your home is wired with phone jacks and you do not use your landline, there is a cheap and easy solution to deliver surprisingly high quality stereo to every room.
First, let's talk about the wires. A landline uses a 2-pin or 4-pin RJ-11 connector. The center 2 pins carry the voice signal. The outer pins carry the signal for "special" features such as caller ID. Though the plug on most telephones only carries the 2 center pins, the wiring in your walls will have all 4 wires. You need one pair of wires for each audio channel, so this works for stereo but not for true surround sound.
The first step is to locate the telephone junction box. It is probably on an outer wall of the basement. You are looking for a small box, maybe 3" by 6", that has a rat's nest of wires jammed in. For the techies out there, think of this like a network hub. On a residential scale, it works in roughly the same manner. For the electrical engineers and telco's out there, please do not flame me for that analogy. I know it's technically incorrect. Point is, there is one set of 4 wires coming from outside the house, and one set of 4 wires for each phone jack in your house. Find the wires coming from outside the house, label them so you can reconnect them again if needed someday, and disconnect them. This is to take your landline completely off the telco's grid so your audio doesn't accidentally interfere with their switching system.
Now, drag up all your unused phone cords. If you can't find any, stop by any surplus store or ask at Goodwill. Sort through them, picking only the ones with 4 pins in the connector.
What you need to do is cut one end off each of the phone cords. Strip the end of the cord, and you will find four wires. The green and red ones are the inner pair; the yellow and black ones are the outer pair. If you get a goofy cable, then the blue ones are the inner pair and the orange ones are the outer pair.
Plug one pair of wires into the left speaker out on your stereo, and the other pair of wires into the right speaker out. It doesn't matter which pair is left or right as long as you're consistent.
Now, gather up all your speakers or go buy yourself some speakers. For each set of speakers you will need another phone cable. Cut off one end and strip it, plugging it into the speakers exactly like you did to the stereo. Plug the other end into the phone jack.
If you're lucky, you can turn on the stereo and it will just work. If you're unlucky, sound will only come out of one channel. In this case you're going to have to go through the house taking the phone jacks out of the wall, one by one, and making sure all the wires are connected. In old houses you might find that the outer pair of wires is not always hooked up to the phone jack.
There are two points to make to answer questions you might already be wondering: First, if you use powered speakers in each room you will be able to turn the speakers on and off and adjust the volume on a room by room basis. Secondly, you will not be stuck with telephone quality sound.
To explain the last point: The reason for telephone quality sound is audio compression to cut off certain audio frequencies so the telephone companies can cram more conversations onto their lines and switches. The wiring in your house is capable of transmitting a much larger frequency range, and when you are using stereo equipment instead of telephones it can take advantage of it.
If anyone tries this, let me know how it goes. I have only done it once, and had great results, but I'd be interested to know how it works for you. Good luck!