I've switched to NetBeans 6 for Ruby coding, and I'll never go back to those bogus text editors.
I'm very excited about this NetBeans release. For a detailed discussion of features, check out Roman Strobl's review (part 1 and part 2). Once the app starts and gets warmed up (which admittedly takes longer than booting the OS on my Windows server box), it does a pretty good job of the hard stuff, like refactoring. And it's rock-solid on the rest, like interactive debugging.
Unfortunately, Rails 2.0 became official at about the same time NetBeans 6 did. And Rails 2 changes a few things, like filenames/extensions on erb templates, that NetBeans doesn't know about. But it's easy to work around those things, and I'm sure an update will be forthcoming.