Switch README to markdown to get Ruby syntax highlighting

We have quite a few code samples on the front page of the project, but they aren't using the normal Github syntax highlighting. This makes it harder to read and leaves a less than ideal impression for newcomers.

I went ahead and switched the README file to the *Github flavored markdown* with all the code samples highlighted.

I also did a small amount of rework on things I thought could use clarification. Mostly linkifying things.