Here is the shell error:
C:\ ..........> gem update
Updating installed gems
Updating fxruby
Successfulyy installed fxruby-1.6.16-x86-mswin32-60
Updating haml
Successfully installed haml-2.0.2
Updating hpricot
Building Native extensions.  This could take a while...
ERROR: While executing gem.... (Gem::Installer::ExyensionBuildError)
ERROR: failed to build gem native extension

Path was given to gem.make.out file which reads:

C:/Program Files (x86)/ruby/bin/ruby.exe extconf.rb update
'C:/Program' is not recognized as an internal or external command,
operable program or batch file.

At first glance it seems the update script does not specify  path correctly 
specified for platform.
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Does anyone know how to fix this?

David