Is it possible to filter a saved search on the line level but still keep main line - true - so that not all line items show? The only way I have been able to have the same results is grouping but not sure if that is the right way.

There is no other way but grouping

What are the criteria for the lines to be excluded?

On my vendor invoice - on the line items - I have a custom field where the user selects the sales order associated with that line (we have cases where the vendor invoice can be for multiple sales orders). I need to filter by the status of the sales order (ie. if it is billed or not).

You can still filter by the status of the SO with mainline F