Try this....
If Line 1 is showing On-Hook. Swith the Cords. See if SP1 is showing On-Hook or not.
If line one is now showing Off-Hook, then the problem lies with the ports on the phone.
If you are willing to give up a phone cord, and want to test things....
Disconect one cord, from both the OBi and the Phone; say from SP2.
Cut it, and splice the red and Green from the end that will go to the OBi to the Yellow and Black that will plug back in the phone.
I know those small wires are tedious to mess with, but I'm kind'a nerdy that way. In the end, it would tell me if what I was thinking was right or wrong.
-G