On the other hand, the above statement applies more to traditional frameworks like CGI::Application, whereas "full-stack" frameworks such as Jifty or Rails also aim to provide the underpinnings for the business logic part (such as object-relational mappers)

Exactly. These are tools that are trying to supply a lot of pre-built code to you, so it matters more how much overhead they add. You will, in theory, run quite a lot of Rails code on every request.

The article states that although "we didn’t come up with complex queries", "when connecting rails to Oracle the performance dropped to the extent it made any production use of the product useless". Anyone has any idea what went wrong there?

Yes. I have read that Ruby has weak Oracle support in it's database libraries. Most people are using PostgreSQL or MySQL, so it doesn't matter to them. Perl is lucky to have really great Oracle support. The DBD::Oracle module has great performance.