Electronic – Power line communication, how to check if frequency is present

In a nutshell, you add a high-frequency, low amplitude signal to the low-frequency, high amplitude AC signal. Powered devices don't care about the added noise, and filtering can extract the high frequency signal without the low frequency component.

Probably due to the dangerous nature of mains power, I haven't seen any blogs or tech notes on how to implement it. However, an Amazon search for "Power Line Communication" yields 325 books, of which most appear pertinent to your question, and by much more qualified persons than myself.

It is possible. However, if you're using an Arduino, you likely don't have the expertise to create a well-isolated and well-insulated shield. No offense intended, I would be hesitant to try it myself, and I've had some training on the topic at a university. Also, an Arduino is meant to be handled, and, as Joby pointed out, it will definitely need a well-designed enclosure.

All things considered, you'll have a much more flexible, easier to create, cheaper, and more robust system if you simply use an Ethernet shield and buy a powerline ethernet adapter like the one you linked to. Do some searching, they're available for less than $30.

Slightly off-topic, but I would consider Power over Ethernet to be much more within the reach of an Arduino shield. National has a decent appnote/FAQ on their LM507X series of powered device controllers. This is something I'd like to try once I get some free time....

• What interface you need to line depends on the specific power line modem.

  Some will have the interface built in so that you can connect phase and neutral directly, while others may require an isolation interface.

  The manufacturer of your modem should provide very very very clear documentation of what is required.

You will usually only be connecting to one phase so have to deal with Phase to Neutral voltage.

If a coupling capacitor was needed I would use one with full "X1" certification.
X2 is of lower spec than X1 but still tested.
X3 is lower spec than X2 and is untested.

It's likely that the value of the users lives, your life and the equipment used is far higher than the cost of a top rated capacitor.

Xx capacitors:

This EPCOS document provides valuable information about X rated capacitors

Some useful related information here Line filter capacitors
They note:

Class X is for applications where failure could not lead to electric shock (hot to neutral).

Class X1 capacitors are intended to operate safely even in the presence of spikes on the mains supply of up to 4 kV (installation category 3 or overvoltage category 3 according to IEC60664), which are normally industrial supplies, but some standards call up class X1 capacitors if they are connected directly to the mains supply upstream of the equipment fuse, irrespective of the type of mains supply.

Class X2 capacitors are intended to operate safely even in the presence of spikes on the mains supply of up to 2.5 kV (installation category 2 or overvoltage category 2 according to IEC60060), which are normally residential, commercial and light industrial supplies.

X capacitors can be found from 0.001 uF to at least 10 uF and are only made in film.

And

Classes X1, X2, and Y were originally defined by the IEC in IEC 60384-14. CENELEC has adopted EN 132400 (technically equivalent to, but structurally different from IEC 384-14 2nd edition), which now defines seven classes of line-filter capacitors.

Class X1 capacitors are impulse tested to 4 kV (higher for capacitors over 1.0 uF).

Class X2 capacitors are impulse tested to 2.5 kV (higher for capacitors over 1.0 uF).

Other - not suitable:

Class Y1 capacitors are impulse tested to 8 kV, and Class Y2 are impulse tested to 5 kV.
Classes X3, Y3, and Y4 are for lower-voltage capacitors, none of which are presently called up in safety standards.
Other impulse tests also apply. These include a 1000 hour endurance test during which the capacitor is subjected to a continuous overvoltage condition, plus periodic 1000 VAC spikes, and a flammability test during which the capacitor is hit with a series of transients while under rated voltage. Capacitors conforming to IEC60384-14 normally also conform to EN132400, and vice versa, and should be accepted in all European countries.