Subdomain_fu rewriting wrong with tld size 2?

I have a website on a demo server at:
mycompany.com

I have a Rails app with subdomain_fu. I’ve verified it’s running in the
right environment and set the TLD Size to “2” so I can have:
myapp.mycompany.com
admin.myapp.mycompany.com
*.myapp.mycompany.com (for users’ customized landing pages)

This works great on my local computer with “myapp.local” and
“admin.myapp.local”

but on my dev server, I’m getting URLs like

http://myapp.mycompany.com/myapp
http://admin.myapp.mycompany.com/myapp

and it’s prepending ‘/myapp/’ to all stylesheet and javascript includes,
causing them to fail

I’ve googled everywhere on this. Any ideas?