Think this through starting at the first OSI layer.  If the line is down
(physical) layer, then how could the next higher layer--which depends on
lower layers--ever possibly hope to function?

It can't.  You can't have a functional datalink layer without first having
valid physical connectivity.

>  Hi Gang,
>      Just been looking at the binary possibilities of
>  these options i.e 0 0
>                    0 1
>                    1 0
>                    1 1
>  
>  And feel thet that Line Down, Protocol Up is
>  impossible.
>  Can anyone confirm this or has anyone seen anything
>  quirky of this nature.
>  
>  Regards,
>  
>  Phil.
>  
>  
>  
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