I'm not sure about the solution but maybe:

Rails 3.0 was the first that used rails new app_name command.
Previously it was rails app_name.
Is that possible you tried first time with rails 3.0 or newer than
second time used with 2.3.x?
Maybe used the one click installer and got the older version. Maybe.
Try rails -v.

On Jan 26, 5:26 am, Dahlby <idahlb...@verizon.net> wrote:
> Hi,
>
> I'm currently slogging my way thru the installation-setting up pages
> of Ruby On Rails 3 Tutorial. I'm a bit new at terminal stuff, and am
> wrapping my head around getting around hidden directories, github, ssh
> keys, blah blah.
>
> Question:
> I'm trying to set up a new app with the command "rails new demo_app".
> It instead gives me a directory called "new" with the usual
> directories, but not all the usual files are there, like Gemfile or
> Readme. I already set up another app before successfully, where it
> generated all the requisite files using my project name in the command
> line (rails new first_app). I'm wondering if I switched something off
> inadvertently between then and now.
>
> Thanks for any help. (I'm sure to be back with more dumb questions)
>
> Ian

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