And the winner is...

I've run ab on the current rails project at work using Apache and Nginx as the proxy frontend to a mongrel cluster. On average I've seen about a 10% increase in performance using Nginx (ymmv). There's plenty of easy mongrel configurations for Nginx that you can find online. Working with Fedora, made this extra simple. Yum install, configure, chkconfig to turn on nginx, chkconfig to turn off apache if you already have that on. More fun to explore is how it does with cached static content.