Also, every phone had its own physical circuit to the exchange, leading to things like this: https://i.redd.it/ugvoc90k4q5a1.jpg
Generally yes and even today, if you've got a twisted pair, it's that down to the exchange. Though party lines were also a thing a very long time ago.
There were also specialist circuits (e.g. EPS) where you had a physical line from end to end (with a couple of amps along the way on longer runs).
Crazy. There is also the https://en.wikipedia.org/wiki/Old_Stockholm_telephone_tower#...