I've heard good things about Ruby on Rails. But, I'm curious as to the motivation of their switch?

Yeah, moving a user over to another server would require a new session and authentication, etc...

We're currently in the process of integrating a reporting application into our existing webapp.

The reporting stuff runs on its own server, so we just set it up in a frame, and pass the username and password on the url. The authentication is then processed on the reporting server and a session is established. It seems to be the only solution, unless we were to actually merge our two applications into a single server (which is possible but requires a lot more in licensing fees). We have our app's navigation in a frame on the top, and the reporting app in a frame on the bottom. Works reasonably well.

Our next task is getting the style/gui consistent across the two apps. This is a work in progress.

And when it comes to permissions/privileges, the report server has its own security model that we've hooked up to our database. It handles all of its own stuff in its own way, we just hook it up to our data and config.