I may get flamed for saying so but Dreamhost support RoR apps, lots of bandwidth/disk space and all for $11/month. It's shared hosting but they support mod_rails / Phusion Passenger which is working out great for me so far (I'm running a Redmine bug tracker on Dreamhost, along with lots of other PHP stuff).
However, I've also got a virtual server from Slicehost where I deploy my own apps... it's noticeably faster than Dreamhost but you do have to deal with lots of sysadmin stuff which distracts you from the RoR learning/development.
My advice would be to start with a shared RoR host (a la Dreamhost) and then migrate to a virtual server host (e.g. Slicehost) once you've got something that's too running slow, getting too popular or is starting to earn revenue.
they are pretty anal about bandwidth though, I had a file hosted and it hit some popular forums, and they shut my account down after like 50 GB of bandwidth was used up
However, I've also got a virtual server from Slicehost where I deploy my own apps... it's noticeably faster than Dreamhost but you do have to deal with lots of sysadmin stuff which distracts you from the RoR learning/development.
My advice would be to start with a shared RoR host (a la Dreamhost) and then migrate to a virtual server host (e.g. Slicehost) once you've got something that's too running slow, getting too popular or is starting to earn revenue.