Quantum networks entangle remote nodes by distributing quantum states, which inevitably suffer from decoherence while traversing quantum channels. Pertinent decoherence mechanisms govern the channel capacity, its reach, and the quality and rate of distributed entanglement. Hence recognizing, understanding, and modeling those mechanisms is a crucial step in building quantum networks. Here, we study practical fiber-optic quantum channels that partially filter individual modes of transmitted polarization entangled states and are capable of introducing dephasing. First, we theoretically model and experimentally demonstrate the combined effect of two independent and arbitrarily oriented polarization dependent loss elements experienced by each photon of an entangled photon pair. Then, we showcase the compensation of lost entanglement by properly adjusting the channels' properties and discuss the resulting tradeoff between the entanglement quality and rate. Our results provide insights into the capacity of practical fiber-optics channels, thus taking an important step towards the realization of quantum networks.