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There are a number of things that could cause a jumpy ping.
The cause that has affected me the most was when I was hosting a web server on my network without throttling the upload speed and people went to it. It also happens sometimes when my brother is uploading files through FTP. To put it simply, if your network hits the upload limit of your ISP (through your modem, not within the network), you will lag excessively as long as that upload speed is maxed out.
Another cause could be the game server itself and not you. You can usually find out if that's the case by looking at everyone else's ping.
I've never played games online at dialup speed, so I'm not certain of the issues that can come up. Needless to say, the extreme limit of such speed doesn't give you much room to play a game and do anything else online at the same time.
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