GitHub User: radar
Thanks Ryan for this screencast!
If people are interested to see what a bigger Rails 3.1 engine looks like, a few friends and I have built a forum system called forem: http://github.com/radar/forem. We would be happy to answer any questions anyone has about building an engine.
You can put them in vendor/plugins or as gems, as long as they are in a position where the class inheriting from Rails::Engine is loaded then they should work as well either way.
I would personally recommend using gems though, as they have versioning support where plugins do not