Some mainstream web hosts (that is, shared hosts) will be using Apache with Phusion Passenger (aka mod_rails http://www.modrails.com/), because it's extremely easy to setup and configure.
That said, if you're doing your own deployment, I think the most common option among developers is to use Nginx as a front-end, proxying requests to either Mongrel or Thin instances. Nginx is becoming increasingly popular with PHP developers as well because it can handle higher concurrency with lower memory usage than Apache (I use it for my WordPress sites).
Finally, if you're looking for an all-in-one cloud hosting solution for ruby apps, I've heard a lot of good things about Heroku (http://heroku.com/), though I haven't used it myself.
Hope that helps!