I struggled with this same issue with Ubuntu 11.10.
In my case readline would seemingly compile properly if I used the following:
$ rvm --skip-autoreconf pkg install readline
as outlined at the bottom of http://beginrescueend.com/packages/readline/
However, when I invoked irb, I would get the normal error "Unable to require readline"
Finally, based on Shane's command line, I invoked the following:
$ rvm install 1.9.3 --with-readline-dir=$rvm_usr_path --with-iconv-dir=$rvm_usr_path --with-zlib-dir=$rvm_usr_path --with-openssl-dir=$rvm_usr_path
rather than the command mentioned at http://beginrescueend.com/packages/readline/
$ rvm install 1.9.2 --with-readline-dir=$rvm_path/usr
In my case version 1.9.3 was what I wanted. And finally irb came up with a functioning readline.
Thanks to everyone here for pointing me in the right direction.