Western Digital WD Livewire Powerline AV Network Kit

Does anyone know if this can be directly connected to your modem (in essence used as a router/switch on one end). 

Here is the setup I want to put together: 

In room 1 I have my modem. Modem would connect to one adapter. The adapter would connect to the wall outlet in the room. One of the adapters ports would then be used to connect to a computer through a LAN. 

In room two I would have my other adapter connected to another wall outlet. Then through one of the adapter ports I would connect my wireless router. 

Essentially I want my modem in room 1 and my wireless router in room 2. Will this do that for me?

The LiveWire is kinda a switch itself, so I see no reason as to why this should not work.

Yes, it would work.   But it depends on how the modem is connecting to the internet.  Is the modem authenticating and loggining in to the DSL/Broadband connection?   In your scenario, the modem would have to do the login, otherwise the ports in room 1 wont work how you want it.

Also, factors affecting a powerline connection could then affect all other devices because they are all connected to the router.  Ideally, the modem would be connected directly to the router (not via powerline connection).  

Why do you want the devices separated in different rooms?