504 Gateway Timeout with One-Click Rails Install

I am attempting to get my rails application to work on the Ubuntu 14.04 one click rails install image. I am following tutorial at https://www.digitalocean.com/community/tutorials/how-to-launch-your-ruby-on-rails-app-with-the-digitalocean-one-click-image. The sample application displays without issue. I developed a sample microposts application following Michael Hartl’s Rails Tutorial. I modified the Gemfile to use mysql2 and then changed my database.yml to point to the mysql2 server instead of using the Heroku deploy method. I then uploaded my entire kit and kaboodle to /home/rails as the user root. After following the instructions to do the bundle install, RAILS_ENV=production rake db:migrate, and bundle assets precompile I go to load the rails application and get a 504 gateway timeout. Static pages load without issue (i.e. http://104.131.5.195/404.html) but the front page does not.

If I tail -40 my unicorn log I get:

root@nathan-hale:/home/rails# tail -40 /home/unicorn/log/unicorn.log 
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/bundler-1.3.5/lib/bundler/setup.rb:17:in `<top (required)>'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:135:in `require'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:135:in `rescue in require'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:144:in `require'
/home/rails/config/boot.rb:4:in `<top (required)>'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:55:in `require'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:55:in `require'
/home/rails/config/application.rb:1:in `<top (required)>'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:55:in `require'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:55:in `require'
/home/rails/config/environment.rb:2:in `<top (required)>'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:55:in `require'
/usr/local/rvm/rubies/ruby-2.0.0-p353/lib/ruby/site_ruby/2.0.0/rubygems/core_ext/kernel_require.rb:55:in `require'
config.ru:4:in `block in <main>'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/rack-1.5.2/lib/rack/builder.rb:55:in `instance_eval'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/rack-1.5.2/lib/rack/builder.rb:55:in `initialize'
config.ru:1:in `new'
config.ru:1:in `<main>'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn.rb:48:in `eval'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn.rb:48:in `block in builder'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn/http_server.rb:750:in `call'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn/http_server.rb:750:in `build_app!'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn/http_server.rb:623:in `init_worker_process'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn/http_server.rb:643:in `worker_loop'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn/http_server.rb:527:in `spawn_missing_workers'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn/http_server.rb:538:in `maintain_worker_count'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/lib/unicorn/http_server.rb:303:in `join'
/usr/local/rvm/gems/ruby-2.0.0-p353/gems/unicorn-4.7.0/bin/unicorn:126:in `<top (required)>'
/usr/local/rvm/gems/ruby-2.0.0-p353/bin/unicorn:23:in `load'
/usr/local/rvm/gems/ruby-2.0.0-p353/bin/unicorn:23:in `<main>'
/usr/local/rvm/gems/ruby-2.0.0-p353/bin/ruby_executable_hooks:15:in `eval'
/usr/local/rvm/gems/ruby-2.0.0-p353/bin/ruby_executable_hooks:15:in `<main>'
E, [2014-09-06T23:34:37.382827 #29321] ERROR -- : reaped #<Process::Status: pid 3365 exit 1> worker=1
I, [2014-09-06T23:34:37.383062 #29321]  INFO -- : worker=1 spawning...
E, [2014-09-06T23:34:37.385768 #29321] ERROR -- : reaped #<Process::Status: pid 3367 exit 1> worker=0
I, [2014-09-06T23:34:37.385948 #29321]  INFO -- : worker=0 spawning...
I, [2014-09-06T23:34:37.386960 #3371]  INFO -- : worker=1 spawned pid=3371
I, [2014-09-06T23:34:37.387144 #3371]  INFO -- : Refreshing Gem list
I, [2014-09-06T23:34:37.391896 #3373]  INFO -- : worker=0 spawned pid=3373
I, [2014-09-06T23:34:37.392136 #3373]  INFO -- : Refreshing Gem list

if I trail -f my nginx log I get:

2014/09/06 22:23:54 [error] 690#0: *65 upstream timed out (110: Connection timed out) while reading response header from upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://127.0.0.1:8080/", host: "104.131.5.195"
2014/09/06 22:31:44 [error] 690#0: *80 upstream timed out (110: Connection timed out) while reading response header from upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://127.0.0.1:8080/", host: "104.131.5.195"
2014/09/06 22:49:10 [error] 690#0: *84 upstream timed out (110: Connection timed out) while reading response header from upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://127.0.0.1:8080/", host: "104.131.5.195"
2014/09/06 22:53:03 [error] 690#0: *86 upstream timed out (110: Connection timed out) while reading response header from upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://127.0.0.1:8080/", host: "104.131.5.195"
2014/09/06 23:11:25 [crit] 13103#0: *1 connect() to unix:/home/rails/tmp/sockets/unicorn.sock failed (2: No such file or directory) while connecting to upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://unix:/home/rails/tmp/sockets/unicorn.sock:/", host: "104.131.5.195"
2014/09/06 23:11:27 [crit] 13103#0: *1 connect() to unix:/home/rails/tmp/sockets/unicorn.sock failed (2: No such file or directory) while connecting to upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://unix:/home/rails/tmp/sockets/unicorn.sock:/", host: "104.131.5.195"
2014/09/06 23:17:38 [error] 18044#0: *1 upstream timed out (110: Connection timed out) while reading response header from upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://unix:/home/rails/tmp/sockets/unicorn.sock/", host: "104.131.5.195"
2014/09/06 23:18:40 [error] 18044#0: *1 upstream timed out (110: Connection timed out) while reading response header from upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://unix:/home/rails/tmp/sockets/unicorn.sock/", host: "104.131.5.195"
2014/09/06 23:25:52 [error] 18044#0: *4 upstream timed out (110: Connection timed out) while reading response header from upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://unix:/home/rails/tmp/sockets/unicorn.sock/", host: "104.131.5.195"
2014/09/06 23:28:55 [error] 18044#0: *6 upstream timed out (110: Connection timed out) while reading response header from upstream, client: 70.188.169.36, server: _, request: "GET / HTTP/1.1", upstream: "http://unix:/home/rails/tmp/sockets/unicorn.sock/", host: "104.131.5.195"

I tried the following suggestions from other threads: commenting out user: rails in /home/unicorn/unicorn.conf, changing from listening on 127.0.0.1:8080 to using a socket (http://recipes.sinatrarb.com/p/deployment/nginx_proxied_to_unicorn) both of which made no difference.

I am using the default nginx.conf other than the change to the socket now:

user www-data;
worker_processes 4;
pid /var/run/nginx.pid;

events { worker_connections 1024; }

http {
        sendfile on;
        tcp_nopush on;
        tcp_nodelay on;
        keepalive_timeout 65;
        types_hash_max_size 2048;
        server_tokens off;

        # server_names_hash_bucket_size 64;
        # server_name_in_redirect off;

        include /etc/nginx/mime.types;
        default_type application/octet-stream;

        access_log /var/log/nginx/access.log;
        error_log /var/log/nginx/error.log;

        gzip on;
        gzip_disable "msie6";
        gzip_types text/plain text/xml text/css text/comma-separated-values;
        upstream app_server { server unix:/home/rails/tmp/sockets/unicorn.sock  fail_timeout=0; }

        include /etc/nginx/conf.d/*.conf;
        include /etc/nginx/sites-enabled/*;
}

My unicorn.conf is:

user www-data;
worker_processes 4;
pid /var/run/nginx.pid;

events { worker_connections 1024; }

http {
        sendfile on;
        tcp_nopush on;
        tcp_nodelay on;
        keepalive_timeout 65;
        types_hash_max_size 2048;
        server_tokens off;

        # server_names_hash_bucket_size 64;
        # server_name_in_redirect off;

        include /etc/nginx/mime.types;
        default_type application/octet-stream;

        access_log /var/log/nginx/access.log;
        error_log /var/log/nginx/error.log;

        gzip on;
        gzip_disable "msie6";
        gzip_types text/plain text/xml text/css text/comma-separated-values;
        upstream app_server { server unix:/home/rails/tmp/sockets/unicorn.sock  fail_timeout=0; }

        include /etc/nginx/conf.d/*.conf;
        include /etc/nginx/sites-enabled/*;
}

Some other interesting tidbits: New Relic sees my application but seems to believe I am in the development environment. So this leads me to believe I need to fix this somehow. It is unclear what more to do since I have done RAILS_ENV=production and if I echo $RAILS_ENV I get production.

I do not believe this is an nginx problem based on its log, it seems to be unicorn.