Return to the Mac OS X default Ruby install:
rvm system
Switch to Ruby 1.9.2:
rvm 1.9.2
Create a new gemset:
rvm gemset create rails3
Switch to newly created gemset:
rvm 1.9.2@rails3
Install rails 3 on new gemset:
gem install rails -v 3.0.3
Return to default ruby install:
rvm system
Install a new version of Ruby:
rvm install 1.9.2