Wow..
CGI will run well on IIS
Rails will run well on IIS.

Rob Conery on running Ruby on Rails (or other CGI based platforms) on IIS:

"Rails works using CGI - basically an executable that gets run each time a request comes into a web site. Most of the frameworks out there do NOT support multi-threading, so each time a request comes in that requires anything dynamic, CGI is "instanced" and executed. If you have a lot of requests at once, this isn't really a good thing. Now some servers are built to mitigate this (Apache, Lighttpd, etc); IIS is not.

... I would imagine that in the next 6 months we'll see a great addition to IIS 6 and 7 for all the CGI-enabled platforms out there."

hmm.. good to hear. (seriously)
but damn... weren't we doing this 10 years ago with Perl/Apache? :)