On the other hand, cable was explained to me as a "party line". It's fast now but as more people get online and more bandwidth gets used, it's still a single cable with a fixed capacity. Now I don't know how it's wired but that makes sense to me.
I can help.
The difference has to do with the topology of the infrastructure. With phone service, there is one set of wires that go from the central office to each location. If a central office serves 1000 locations, there are 1000 sets of wires that converge at the central office. (It's a little more complex than that, but the complexities are out of scope.) It's basically a hub-and-spoke topology.
Cable is mostly a daisy-chain topology, where your cable comes from the next closest termination point and branches off to the next point after that, like branches on a tree.
With the daisy-chain topology there is no choice but to make the entire segment a single network because there is no physical separation in the wires. That means the capacity of the infrastructure is divided among the number of nodes in the segment. If cable can support 20Mbit throughput and there are 20 people on the segment, each node will only be able to utilize 1Mbit of simultaneous throughput. If they sold you a 20Mbit connection they have oversold their service by a factor of 20. There is a hard trade-off between number of nodes and available throughput at each node. The only way to increase it is to run more wire to create more segments that have fewer nodes each.
With the hub-and-spoke topology you have a dedicated connection to the central office. A 3Mbit DSL connection means you have the full 3Mbit throughput to the central office, no matter what the other 1000 nodes might be using at any given time.
The big problem with the overselling plagues the hub-and-spoke topology just as much, though. Once all 1000 of those 3Mbit DSL connections reach the central office, they have to be multiplexed and routed up to the carrier networks. The multiplexing equipment in each central office has a limited amount of combined throughput, so if they are multiplexing 3,000Mbit worth of DSL connections but their equipment can only do 100Mbit of combined throughput, they are oversold by a factor of 30. So while a DSL modem can send and receive data at a full 3Mbit to the central office, you hit a bottleneck with too many individual lines trying to merge through equipment that can't handle it all.
The problem is the ISPs are not overselling by reasonable factors like 2, 4 , or 6 times capacity. They are overselling their capacity by factors of 100 or more and then blaming the users for the problem.