I just came up for air from working on my take to browse hacker news for a bit. A lot of work for one man, but I'm moderately pleased with the progress I've been making.
Heroku is a cloud-based deployment and hosting solution for Ruby apps (and soon to be Node.js javascript apps too). Google App Engine is for Python and Java.
But GAE doesn't have a SQL db. Now, for some apps that may even be an advantage, but these frameworks are really setup for having a SQL db behind them.
The same exact code that you would deploy to a VPS can run on Heroku without issue, save some limitations like the read-only filesystem. That's a big plus.