I've used Ruby for quite a while. I don't use Rails, and I haven't touched a web application in a long time. I've used it for system scripts, GUI applications (JRuby), game development, data processing, automation of MS Office applications, testing, prototyping, distributed build and deploy scripts, middleware, etc. I use Ruby for anything and everything I can think of programming unless I need to get closer to the hardware or integrate with something written in a different language.
Ruby can be used and will be used anywhere that Python can. They're both great languages, but I prefer Ruby for a few small reasons that Yegge seems to cover.
It's understandable that you might have this confusion, though, since if you're not a Ruby user it's easy to get the impression that Rails is the programming language. I constantly have to educate people about that ("Repeat after me: Rails is not a programming language"). Sometimes I wish Rails wasn't so popular, because I believe Ruby can stand on its own. I'm tired of conversations like this:
"Have you heard of Ruby?"
"No."
"Okay, have you heard of Rails?"
"Oh, Rails! That's what you're talking about!"
"No, that is not what I'm talking about."
I get this from the standard folks who never venture outside of their C++/Java/C# pens, and they've heard of Python only because of Google (tip for language evangelists: a hot and trendy company does more for your language than a killer app).
I would expect, however, that people who use Python would realize that Ruby stands right beside it as a similarly beautiful and productive dynamic language. In this I am constantly disappointed. Maybe it's a sign that Ruby is losing the popularity contest and will fade away to the sidelines. There are too many clueless people who pick up Python and love it and swear by the gods that there is no language like it, even though their experience with languages is summed up with C++, Java, and now Python. It's the language that ropes in all the clueless people that eventually wins. Congrats to my Python brothas.
"There are too many clueless people who pick up Python and love it and swear by the gods that there is no language like it, even though their experience with languages is summed up with C++, Java, and now Python. "
To be fair, the same seems true of Ruby (mostly via Rails); they come from Java or PHP and declare Ruby the pinnacle of language design.
(I'd like to think, though, they are a mostly a noisy minority. There are a lot of Ruby, non-Rails Ruby, developers who just quietly go about their business.)
