I am writing this to document the steps I had to take to get a Rails 3 app to connect to an existing Sql 2008 Server using ActiveRecord. I have an existing database that the rails app needs to pull data from and I am developing locally on a mac. It is pieced together from several other HOWTO's and a bunch of trial and error.
The dependancies to make all of this work are unixodbc, FreeTDS, ruby-odbc and activerecord-sqlserver-adapter.