Why are you expecting a rails plugin to provide an xhtml navigation menu? Why not just implement the drop down menu using simply xhtml (lists) and css?
Try this:
Specifically:
If you want to get fancy (and you use jQuery), try this: http://users.tpg.com.au/j_birch/plugins/superfish/
Specifically: http://users.tpg.com.au/j_birch/plugins/superfish/#sample4
HTH.