>         <!-- For some reasons this block doesn't show up under rails3
> but in rails 2 it's working -->
>   <% f.fields_for :author do |author_form|%>
>     <div class="field">
>     <%= author_form.label :name%>
>     <%= author_form.text_field :name %>
>     </div>
>   <% end %>

replace
<% f.fields_for :author do |author_form|%>
with
<%= f.fields_for :author do |author_form|%>
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