How can I force gem to upgrade to gem 1.3.1

I am trying to install a gem like this:

C:\InstantRails\rails_apps\foodmarksthespot>ruby script/plugin install git://github.com/lazyatom/engines.git

Which returns this message:

Rails requires RubyGems >= 1.3.1 (you have 1.2.0). Please `gem update --system` and try again.

But when I try to update using:

gem update --system

it says:

Updating RubyGems
Nothing to update

This is on windows. How can I force it to upgrade the system to a specific version?

From stackoverflow

• What do you get if you run gem --version in cmd? It sounds like the gem executable you are running in cmd is not the same one Rails is using.

  Kyle Boon : gem --version returns 1.2.0. Meant to include that in the message.

• http://rubyforge.org/forum/forum.php?forum_id=28071

  From there:

  NOTE: RubyGems 1.1 and 1.2 have problems upgrading when there is no
  rubygems-update installed. You will need to follow the second set of update
  instructions if you see "Nothing to update".
  
  If you have an older version of RubyGems installed, then you can still
  do it in two steps:
  
  $ gem install rubygems-update (again, might need to be admin/root)
  $ update_rubygems (... here too)
  

  ecleel : I have rubygems 1.0.1 and last solution work with me. UP vote. :)