I am experimenting using Neography with Rails 3 and can't quite understand where to specify DB connections, Model Validations (validates_presence_of) etc. The examples available for Neography does not have one for Rails. Would appreciate any pointers.
I don't think Neography integrates that closely with rails, or has an ActiveRecord mapper. You can find configuration information on their wiki: they don't explicitly say it, but you should copy that config in to initializers/neography.rb.
In regards to Models, specifically in regards to the Neography gem, you're probably best off storing data in normal Postgres/Mysql/sqlite, and using after_create, after_update, after_delete hooks in your models to then keep the neo4j database in sync. If you do it this way, you really only have to store the minimum amount of data needed in Neo4j (e.g. object ids and only the data your actively using for node and vertice graph operations). Then, when you query neo4j, you'd take the resulting object id's and "rehydrate" them by querying your SQL ActiveRecord models
The alternative is to use the Neo4j gem itself which offers ActiveRecord mappers and a much cleaner api. But I assume that you're not doing that because of environment constraints (for example, you want to run on Heroku and use the Neo4j addon)