Rails reading from wrong assets folder

Hi, I'm having some trouble with the rails on my webhost. Something went wrong when switching from 3.0 to 3.1 and configuring the assets pipeline. Been following the guide:

But it didn't do the trick. The weird thing is that I now have 2 assets folders (I guess one got generates from rails or something) one in public/assets and one in app/assets/, but it reads everything from public/assets.

I'm wondering how to redirect the assets pipe to app/assets.

P.S The css and images works in this public/assets, but not the JS.