OK.. much clearer.
I misunderstood your initial query.
The 7550 adsl modem is also a router.
Unless you have bridged it or requested ATT to bridge for you, (if supplied by ATT they are likely locked and remote controlled), then you should setup the TC in bridge mode and NOT PPPOE.
In fact let me strongly recommend if you did bridge the 7550 you unbridge it post haste. The Apple routers are unreliable doing PPPOE. I am stuck on ADSL at this time and I cannot use apple router reliably as PPPOE client. Any other router is ok.. but the Apple just don't work.
Apple should recognise you are plugged into a router and setup wizard go to bridge mode on the TC. Sadly this fails because Apple recognises the PPPOE client and seems to want to take over.
The wizard is probably failing for that reason.
The solution is a fully manual setup.
I am going to suggest a somewhat more complicated setup.. but to get it going on a first run through do the following.
Factory reset universal
Power off the TC.. ie pull the power cord or power off at the wall.. wait 10sec.. hold in the reset button.. be gentle.. power on again still holding in reset.. and keep holding it in for another 10sec. You may need some help as it is hard to both hold in reset and apply power. It will show success by rapidly blinking the front led. Release the reset.. and wait a couple of min for the TC to reset and come back with factory settings. If the front LED doesn’t blink rapidly you missed it and simply try again. The reset is fairly fragile in these.. press it so you feel it just click and no more.. I have seen people bend the lever or even break it. I use a toothpick as tool.
N.B. None of your files on the hard disk of the TC are deleted.. this simply clears out the router settings of the TC.
Setup the TC again.
Then redo the setup from the computer you want to use for TM using Airport Utility.
1. Use very short names.. NOT APPLE RECOMMENDED names. Your name as shown in the screenshot is not so great. No spaces and pure alphanumerics.
eg TCgen5 for basestation and TCwifi wireless name. <10 Characters gets bonus points.
2. Use all passwords that also comply with 1. but can be a bit longer. ie 8-20 characters mixed case and numbers.. no non-alphanumerics.
**3. I have left this in for completeness.. but this can be important for reliable operation.
If the TC is main router you can skip this point. This is only an issue when the TC is bridged.
Ensure the TC always takes the same IP address.. you will need to do this on the main router using dhcp reservation.. or a bit more complex setup using static IP in the TC.
Ignore this point if you don't understand it .. post back if you have drop out issues.
4. Make sure IPv6 is set correctly in the computer. ie link-local only for ethernet and/or wireless depending on which you use. Auto is not good enough.
Open the preferences for networking and set it.
eg wireless .. Go to Advanced and TCP/IP tab.. Configure IPv6 and change to Link-local only.

Now when you go through the setup wizard .. using ethernet can help loads.. using wireless to setup wireless is rather like sawing off the branch you are sitting on.. anyway.. if you can plug in do so.. if not no biggie.
Here I reset my TC for you and do a reconfigure in bridge mode. I am going to post this first due to likely mess up of the network.