Downsides:

Rails is a sharp knife. There is Rails way to do things. You may of course choose to do them differently (this is a contrast with other toolkits that fight this hard), but you are going to have to understand the system well to make that anything but a giant hassle.

With rails, the way it scales is statelessness. You have to map the front end actions to individual endpoints on the server. This works seamlessly for crud stuff (create a thing; edit a thing; delete a thing; list those things). For other use cases it works less seamlessly. NB: it works seamlessly for nested "things" too.

Complex multi-step flows are a pain point. eg you want to build data structures over time where between actions on the server (and remember, you must serialize everything you wish to save between each action), you have incomplete state. Concretely: an onboarding flow which sets up 3 different things in sequence with a decision tree is going to be somewhat unpleasant.

You must keep most state on the server and limit FE state. Hotwire works extremely well but the FE must be structured to make hotwire work well.

I've actually found it to work pretty well with individual pages build in react. My default is to build everything with hotwire and, when the FE gets too complex, to fall back to react.

Rails is nobody's idea of a fast system. You can make it perform more than well enough, but fast it is not.

Upsides, my take: it is the best tool to build websites. The whole thing is built by developers for developers. DX and niceness of tools are valued by the community. Contrast with eg the terrible standard lib that other languages (hi, js) have. Testing is by far the most pleasant I've used, with liberal support for mocking rather than having to do DI. For eg things like [logic, api calls, logic, api calls, logic, db calls] it works incredibly well. It is not the most popular toolkit and it's not react, so that can count against you in hiring.