I think the problem might be related to the heroku server type (or idiomatically: stack). The normal stack (called Aspen, I think) is launched by Debian Etch, which does not support newer versions of Rails (i.e. Rails 3) and neither Sinatra.
To solve the problem, you can switch to the Bamboo stack, which is launched by Debian Lenny. You can do this by switching the stack as follows:
heroku create yourname --stack bamboo-mri-1.9.2
"Your name" is, of course, the name of your application. After that, he should work as he should.
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