gistfile1.txt

% script/generate model GrandParent name:string
      exists  app/models/
      exists  test/unit/
      exists  test/fixtures/
      create  app/models/grand_parent.rb
      create  test/unit/grand_parent_test.rb
      create  test/fixtures/grand_parents.yml
      create  db/migrate
      create  db/migrate/20090127182616_create_grand_parents.rb

% script/generate model Parent name:string grand_parent_id:integer
      exists  app/models/
      exists  test/unit/
      exists  test/fixtures/
      create  app/models/parent.rb
      create  test/unit/parent_test.rb
      create  test/fixtures/parents.yml
      exists  db/migrate
      create  db/migrate/20090127182710_create_parents.rb

% script/generate model Child name:string parent_id:integer
      exists  app/models/
      exists  test/unit/
      exists  test/fixtures/
      create  app/models/child.rb
      create  test/unit/child_test.rb
      create  test/fixtures/children.yml
      exists  db/migrate
      create  db/migrate/20090127182723_create_children.rb

% cat app/models/grand_parent.rb 
class GrandParent < ActiveRecord::Base
  has_many :parents
  accepts_nested_attributes_for :parents
end

% cat app/models/parent.rb 
class Parent < ActiveRecord::Base
  has_many :children
  accepts_nested_attributes_for :children
end

% rake db:migrate
(in /Users/eloy/tmp/3-levels)
==  CreateGrandParents: migrating =============================================
-- create_table(:grand_parents)
   -> 0.0051s
==  CreateGrandParents: migrated (0.0056s) ====================================

==  CreateParents: migrating ==================================================
-- create_table(:parents)
   -> 0.0028s
==  CreateParents: migrated (0.0029s) =========================================

==  CreateChildren: migrating =================================================
-- create_table(:children)
   -> 0.0032s
==  CreateChildren: migrated (0.0033s) ========================================

% sc
Loading development environment (Rails 2.3.0)
>> GrandParent.count
=> 0
>> Parent.count
=> 0
>> Child.count
=> 0

>> GrandParent.create(:name => 'grand parent', :parents_attributes => { 'new_1' => { :name => 'parent 1', :children_attributes => { 'new_1' => { :name => 'child 1' }, 'new_2' => { :name => 'child 2' } } }, 'new_2' => { :name => 'parent 2', :children_attributes => { 'new_1' => { :name => 'child 1' }, 'new_2' => { :name => 'child 2' } }}})
=> #<GrandParent id: 1, name: "grand parent", created_at: "2009-01-27 18:32:18", updated_at: "2009-01-27 18:32:18">

>> GrandParent.count
=> 1
>> Parent.count
=> 2
>> Child.count
=> 4

>> Parent.all
=> [#<Parent id: 1, name: "parent 1", grand_parent_id: 1, created_at: "2009-01-27 18:32:18", updated_at: "2009-01-27 18:32:18">, #<Parent id: 2, name: "parent 2", grand_parent_id: 1, created_at: "2009-01-27 18:32:18", updated_at: "2009-01-27 18:32:18">]

>> Child.all
=> [#<Child id: 1, name: "child 1", parent_id: 1, created_at: "2009-01-27 18:32:18", updated_at: "2009-01-27 18:32:18">, #<Child id: 2, name: "child 2", parent_id: 1, created_at: "2009-01-27 18:32:18", updated_at: "2009-01-27 18:32:18">, #<Child id: 3, name: "child 1", parent_id: 2, created_at: "2009-01-27 18:32:18", updated_at: "2009-01-27 18:32:18">, #<Child id: 4, name: "child 2", parent_id: 2, created_at: "2009-01-27 18:32:18", updated_at: "2009-01-27 18:32:18">]