I liked Ruby, but one of the things that turned me off from it for web development is deployment: not only do you need a server in front (such as Apache or nginx), but then you need to also monitor the couple of Mongrel servers for your app, which take up quite a bit of memory. Since I'll be using a VPS with only 256-512MB of RAM and want to create a couple of sites, I don't see Ruby as being a good solution.
I don't personally use Ruby very much, if for no other reason than it seems to invoke my innate fear of Perl ;)
That being said, JRuby is a seriously reasonable choice for a production dynamic language. I use Rhino instead because I think JS 1.7 is a better language, but you can't go wrong with either one. One of the nice things about using a dynamic JVM language is that you can have the all of the really nice benefits that Java offers for infrequently changing infrastructure code (checked exceptions, mostly) without any of its drawbacks for prototyping or rapidly evolving web logic (no first class functions or object-literal syntax).
If you find yourself interested in Rhino but put off by the somewhat unapproachable state of the language in general then let me know, I have some code that really bridges the gap that I'm in the process of preparing to be open-sourced but I'd be happy to share it with anyone who is interested on an exploratory basis.
I liked Ruby, but one of the things that turned me off from it for web development is deployment: not only do you need a server in front (such as Apache or nginx), but then you need to also monitor the couple of Mongrel servers for your app, which take up quite a bit of memory. Since I'll be using a VPS with only 256-512MB of RAM and want to create a couple of sites, I don't see Ruby as being a good solution.