After a long frusturating morning, I had to hack:

/opt/local/lib/ruby/gems/1.8/gems/capistrano-2.3.0/lib/capistrano/recipes/deploy/strategy/remote_cache.rb to:
def copy_repository_cache
logger.trace “copying the cached version to #{configuration[:release_path]}”
run “cp -RPp #{repository_cache}/SocialEmpire #{configuration[:release_path]} && #{mark}”
end

See the SocialEmpire hack?

Ugh.