Thank you for your help! Yes I did install it for the second user as well.
There was also one other problem, the animation gem I used before was included in the next compass version, which was I guess updated in the meantime so they clashed. Once I sorted the animation gem on the old project, cleared and compiled CSS it all went ok.
But now I have another issue:
$ compass watch
>>> Compass is watching for changes. Press Ctrl-C to Stop.
Missing dependency 'rb-inotify' (version '~> 0.9')!
Please run the following to satisfy the dependency:
gem install --version '~> 0.9' rb-inotify
For a better performance, it's recommended that you satisfy the missing dependency.
Compass is polling for changes
When i try to install it I get this:
$ gem install --version '~> 0.9' rb-inotify
Fetching: ffi-1.9.0.gem (100%)
Building native extensions. This could take a while...
ERROR: Error installing rb-inotify:
ERROR: Failed to build gem native extension.
mkmf.rb can't find header files for ruby at /usr/share/include/ruby.h
Gem files will remain installed in /home/name/.gem/ruby/1.9.1/gems/ffi-1.9.0 for inspection.
Results logged to /home/name/.gem/ruby/1.9.1/gems/ffi-1.9.0/ext/ffi_c/gem_make.out
I tried searching for a solution but couldn't find anything within my non-programmer reach. As far as I can tell it does have something to do with dependencies or how ruby was installed.