We recently moved a rails site to a new vps and wanted to have a more stable environment by installing common libraries by package instead of using gem versions (to not potentially break things in an update).
However, it turns out there is a bug in Ubuntu Lucid with the RMagick version test.
If your rails app gets a 500 error with RMagick having the wrong version number, try this for a short term fix and place it in your environment.rb:
RMAGICK_BYPASS_VERSION_TEST = true
