Figured out this error, please DISREGARD! We were forgetting to redirect to the callback_url at the end of the request_phase as we thought that was handled by OmniAuth (oops...)
To replicate this error you should be able to do the following:
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Clone the gem repository from: https://github.com/stevenhaddox/oa-casport and switch to the 'initial' branch ($ git checkout initial).
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Clone the sample Sinatra application from: https://github.com/stevenhaddox/oa-casport-sinatra. Make sure that this clone is at the same folder level as the oa-casport gem clone checkout. This will enable the gem 'oa-casport', :path => '../oa-casport' to work properly from within the Gemfile.