I got a 'digital phone line' through the local cable company installed about a decade ago. I had it hooked up to a rotary phone and I was able to dial out just fine with it.
Pulses can be detected by modern stuff just fine, when said detecting occurs on the same electrical circuit that the phone is connected to (for example, an analog to VoIP interface). They just can't be detected on some other circuit that has only the audio, for example when a conversion to digital audio has occurred. Only tones make it through such conversion. And while a VoIP interface capable of detecting pulses will happily do so (and convert them into something more useful) when it is presenting a dial tone, it won't do a conversion to DTMF for the benefit of IVR [0] mid-call. Devices specifically design to perform this task, however, will!
