Alot of times customers do get taken advantage of, and it is a sad thing, but alot of time it is not fully understanding what the need of the customer is, and how they will be using it and what is intended. The lifeline is for phone service, it is not a program given by the utility (phone company) but paid for by the government agency overseeing it. Perhaps you did get a person not very knowledgeable or who was not fully understanding the need.
As far as the internet connection and phone line dropping, this might be a line issue. Unfortuneately Windstream inherited lines left by former companies in the area of your service, and sometimes those lines are underground, get wet or are on poles that need servicing, and unfortuneatly it does take alot of customer complaints in the service area to get them to move on it, they do have to spend millions to fix certain pockets, which might only service 2 or 3 people, and those areas wont' take precidence over larger areas...similar to getting power cut on after a major storm...larger areas take precidence. And today with so many others competing for public utilities like the phone company, service areas are seemingly actually smaller than they might appear.