I'll take your word for it with TeX; I use LaTeX and I know other people who have, but I don't know what professional authors or publishers use for typesetting.
However, I think your specific example doesn't reflect the argument I imagined you making. Your comparison is someone smart who doesn't know the tools (Ruby, Rails, Javascript) with someone who knows them well. If it were a short project, at least, I agree with you; I'd probably take the guy who knows the tools.
It's not even the tools, it's things like iterating quickly, having working code, good deployment tools, understanding of usability, etc. Nobody has an unlimited amount of time. And sometimes the people who kick ass at algorithms don't give a damn about anything else (and if they're academics that fine). The 'Rails guys' won't have their dreams crushed by performance issues. They'll learn what they need - in fact, since most web app performance is IO bound that's often the first thing they learn to optimise.
However, I think your specific example doesn't reflect the argument I imagined you making. Your comparison is someone smart who doesn't know the tools (Ruby, Rails, Javascript) with someone who knows them well. If it were a short project, at least, I agree with you; I'd probably take the guy who knows the tools.