Hi TD,
The theory dictates you should always opt for longer LAN cable and short phone cable. Ethernet is good for hundreds of feet without any degradatrion at all. Whereas anytime you extend the phone wiring (or modem cable) you're probably picking up more interference that may well degrade your speed.
That said, if it suits you better to extend the modem cable, 3 feet may not make a lot of difference either way.
And in any case it's an inexact science - there's a small but finite possibility that if you extend the modem cable and move the router, it may end up in a place that's quieter (in terms of interference), which would give you better speed. That's unlikely though.
- 7LM