I see the same thing in 1.2.1. In firefox I see a page that says only “You are being redirected” with a link that points to my logon page (a redirect_to in the code). In IE 7, I saw only 404’s. I just rolled back using “gem uninstall rails” and now my app is happy again.
I got to the 404 problem only after a bunch of other painful migration work. At first in Rails 1.2.1 on Windows, my previously working app first would kill the webserver unless I used config.cache_classes = false in development.rb. No useful error messages at all. I got things running again by removing all areas of my app (models, plugins, libs, helpers), and adding them in one by one (I was unsure exactly where the problem was). The Selenium on rails plugin seems to have been the culprit and I suspect it is related to the new require rules, but I haven’t nailed down the file and line and won’t be looking at 1.2.1 again for quite some time. Once I got server to run, I still had the problem above.
Please let me know what you find if you resolve the 404 problem. Also, are you using IE or Firefox? In other words, does your experience match mine? Good luck!
Eric