A bit of background:
RHEL5 and its offspring (referred from here on out as RHEL5) ship with a really dated version of Ruby (1.8.5). Yes there are various patches are backported but in the end, it's old. NOTHING works with it. No modern Gems work with it (for all intents and purposes). God forbid you try to run a modern Rails-based application on it.
The MAIN reason is one that plagues not only Ruby but Perl, PHP and Python on the same platform:
language-specific packaging repositories
With Perl, you have CPAN. With PHP, you have PECL/PEAR. With Python you have Eggs. All of these are somewhat antithetical to the OS package management system. Taking it even further, it's the same problem with Debian offshoots as well.
This isn't a problem for most end-users. They have the luxury of installing stuff wily-nilly. If it breaks, you just reinstall. However for those of tasked with maintaining systems in production environments, this is simply unacceptable. There is a requirement to keep systems in a consistent state. Software must be tested and work its way through the system before it gets to production.
OS updates are the same way. You don't simply have a cronjob that does a 'apt-get upgrade' or 'yum -y update'. Any smart company manages those packages using an internal repository. Packages aren't graduated to the production repository until they've been tested and verified not to break the system. A system MUST be maintainable. At one company, we actually managed our OWN application code via RPM. We had 3 repositories (dev, qa, production) and each class of server pointed to those repositories. As we built new RPMs, they were copied into each repository as needed for testing.
Now many people are probably thinking how convoluted that sounds but personally, I have no desire to have the financial future of my company at the hands of one broken upstream package. How would you feel if your banking site went offline because of the same issue? One broken upgrade can put someone out of a job.
So what happens if you say "screw it" and just use CPAN or rubygems or PECL outside of the system package management? Now what happens when you upgrade from something like PHP 5.2 to PHP 5.3? Now you have to rebuild any native extensions you have installed. Oh but look, the ImageMagick native extension requires that's compatible with version X of your interpreter also requires a new version of ImageMagick. But that version happens to be a major release instead of a point release. Let's hope nothing critical to the system requires a specific version of ImageMagick.
The specifics of the previous are somwhat hypothetical but everyone has run into the situation.
It's a difficult beast to tame. The closest I've come to having this process be somewhat simply is CPAN2RPM. However nothing that clean exists for Ruby. The best you can hope for is something like RVM (which in and of itself is pretty brilliant).
I still don't know the best way to manage Ruby on CentOS right now. There are countless repositories out there that are trying to do the same thing.
One thing we did at RBX which I've been doing currently is the concept of a "current" symlink. It's a bit convoluted but it works out for now and is pretty much the way that RVM works. Having this wrapped in a wrapper RPM keeps it managed via native package management but it's far from ideal.