Weird problem - Ping and DNS work; nothing else does.

I have a weird network problem. I can ping machines on the Internet but
I can't do anything else (I'm using Debian stable).

My machine is connected to an ADSL modem/router via ethernet. The
modem's address is 192.168.1.254, my machine's address is 192.168.1.1.
The modem is correctly set as the default gateway.
- I can ping the modem;
- the modem can ping me;
- I can ping machines on the Internet;
- name lookups are working fine;
- traceroute only gets as far as the gateway.

The weird thing is that it looks like a firewall problem to me but I
disabled the firewall (see below) and there was no change. The modem
has a firewall but that can't be the issue because I multiboot the
machine (2 other Linuxes and Win2k) and none of the other OSs has the
same issue (ie. the net works OK on all of them.

I'm stumped and would appreciate any ideas.

I disabled the firewall by flushing all iptables rules and setting
default policies of ACCEPT:

> iptables -P INPUT ACCEPT
> iptables -P FORWARD ACCEPT
> iptables -P OUTPUT ACCEPT

Just to be sure, I explicitly enabled traffic on eth0 and lo:

> iptables -A INPUT -i lo -j ACCEPT
> iptables -A OUTPUT -o lo -j ACCEPT
> iptables -A INPUT -i eth0 -j ACCEPT
> iptables -A OUTPUT -o eth0 -j ACCEPT

iptables -L output:
===================
Chain INPUT (policy ACCEPT)
target prot opt source destination
ACCEPT all -- anywhere anywhere
ACCEPT all -- anywhere anywhere

Chain FORWARD (policy ACCEPT)
target prot opt source destination

Chain OUTPUT (policy ACCEPT)
target prot opt source destination
ACCEPT all -- anywhere anywhere
ACCEPT all -- anywhere anywhere
----------------------------------------------------------

ifconfig output:
================
eth0 Link encap:Ethernet HWaddr *****
inet addr:192.168.1.71 Bcast:192.168.1.255 Mask:255.255.255.0
UP BROADCAST RUNNING MULTICAST MTU:1500 Metric:1
RX packets:580 errors:0 dropped:0 overruns:0 frame:0
TX packets:814 errors:0 dropped:0 overruns:0 carrier:0
collisions:0 txqueuelen:100
RX bytes:45888 (44.8 KiB) TX bytes:62239 (60.7 KiB)
Interrupt:11 Base address:0xe000

lo Link encap:Local Loopback
inet addr:127.0.0.1 Mask:255.0.0.0
UP LOOPBACK RUNNING MTU:16436 Metric:1
RX packets:0 errors:0 dropped:0 overruns:0 frame:0
TX packets:0 errors:0 dropped:0 overruns:0 carrier:0
collisions:0 txqueuelen:0
RX bytes:0 (0.0 b) TX bytes:0 (0.0 b)
----------------------------------------------------------------------

route output:
=============
Kernel IP routing table
Destination Gateway Genmask Flags Metric Ref Use Iface
192.168.1.0 * 255.255.255.0 U 0 0 0 eth0
default 192.168.1.254 0.0.0.0 UG 0 0 0 eth0
-----------------------------------------------------------------------------

Cheers,
c.