I really love Seaside, and I am still as amazed by it today as the day I saw it. But I just can't justify being "isolated" inside of the Smalltalk VM. There's just too much wheel-reinventing required to build a major web app in Smalltalk. The libraries are a dealbreaker and that's really too bad, because programming in Smalltalk is amazing.
Just curious: what do you mean by 'wheel-reinventing' and 'libraries are a dealbreaker'?
Smalltalk contains a comprehensive set of classes, and Seaside has 'out-of-the-box' support for Scriptaculous and JQuery, and has numerous examples of web app components...
As for the 'isolation' within a Smalltalk VM: isn't a virtualised environment actually beneficial for scalability?
When you develop a web app in Rails and you hit a snag you can usually solve it by grabbing a Gem or a Rails plugin. Similarly, if you need to do something in Java there is most likely a good mature library out there already, and you can just drop a Jarfile in your project and go.
I'm talking about all the odd little things you end up doing in web apps, like drawing charts or parsing PDFs or talking to some obscure web service. You'd be left to solve these things on your own with Smalltalk (although solving them may be easier).
That's not really true because you can always shell out Linux and do that chunk of work in some other language. You're not trapped in Smalltalk. I've used ImageMagick and Markdown in a Seaside app without issue.
You do you feel "isolated" any more than you are in Java, Erlang, or any other VM language? Smalltalk has FFI. There are a lot of advantages for the "edit the exe while it's running" approach of the Smalltalk image.