Combining FastCGI and Rack? You've effectively described Phusion Passenger, because that's exactly what it is. It doesn't use the FastCGI wire protocol but how it works is exactly that: integrated in the web server, reuses a Ruby process for multiple requests to avoid the startup overhead, using Rack as the gateway interface, etc.
Indeed. The code is even simpler, and you're getting the shell out of the equation. Remember that bash bug from late last year?
Also the use of the phrase "bare metal" in reference to a ruby CGI script is pretty lulzy. I suppose thats the new normal. The embedded programmers of the world must feel pretty annoyed when people do that. I suppose they're too high on magic smoke to care.
