I know you said you did not want me to try to help you, but this
apparently tells you how to install a later version of Rails (and
Ruby, since 1.8.7 is also out of support) on Dreamhost.
I cannot personally see any reason to start a new application with
anything other than the latest current version of Rails. I believe
even 3.2.x will go out of support very shortly, though I cannot
immediately find the announcement where I believe I saw that.