uwsgi error python application not found

I've configured my nginx server with uwsgi and python and when I try to run my python application by hitting the url in my browser, the browser returns the message, uwsgi error python application not found.

This is what my uwsgi log looks like:

*** Starting uWSGI 1.0.4 (32bit) on [Tue Jul 31 15:25:04 2012] ***
compiled with version: 4.6.3 on 27 July 2012 17:02:36
current working directory: /home/paul/Desktop/x/studio
detected binary path: /home/paul/Desktop/x/studio/bin/uwsgi
uWSGI running as root, you can use --uid/--gid/--chroot options
*** WARNING: you are running uWSGI as root !!! (use the --uid flag) *** 
*** WARNING: you are running uWSGI without its master process manager ***
your memory page size is 4096 bytes
probably another instance of uWSGI is running on the same address.
bind(): Address already in use [socket.c line 598]
[pid: 3868|app: -1|req: -1/11] 127.0.0.1 () {38 vars in 911 bytes} [Tue Jul 31 15:25:22      2012] GET /ai?api=%3CIron%3E%3CAction%3E%3CService%3EUserAuth%3C/Service%3E%3CUsername%3Eadmin%3C/Username%3E%3CPassword%3Eadmin%3C/Password%3E%3C/Action%3E%3C/Iron%3E => generated 48 bytes in 0 msecs (HTTP/1.1 500) 2 headers in 63 bytes (0 switches on core 0)
[pid: 3864|app: -1|req: -1/12] 127.0.0.1 () {38 vars in 655 bytes} [Tue Jul 31 15:25:34 2012] GET /ai?api=%3CIron%3E%3C/Iron%3E => generated 48 bytes in 0 msecs (HTTP/1.1 500) 2 headers in 63 bytes (0 switches on core 0)
[pid: 3864|app: -1|req: -1/13] 127.0.0.1 () {38 vars in 655 bytes} [Tue Jul 31 15:25:38  2012] GET /ai?api=%3CIron%3E%3C/Iron%3E => generated 48 bytes in 0 msecs (HTTP/1.1 500) 2 headers in 63 bytes (0 switches on core 0)
[pid: 3864|app: -1|req: -1/14] 127.0.0.1 () {38 vars in 655 bytes} [Tue Jul 31 15:25:48 2012] GET /ai?api=%3CIron%3E%3C/Iron%3E => generated 48 bytes in 0 msecs (HTTP/1.1 500) 2 headers in 63 bytes (0 switches on core 0)
[pid: 3868|app: -1|req: -1/15] 127.0.0.1 () {38 vars in 655 bytes} [Tue Jul 31 15:26:11 2012] GET /ai?api=%3CIron%3E%3C/Iron%3E => generated 48 bytes in 0 msecs (HTTP/1.1 500) 2 headers in 63 bytes (0 switches on core 0)

uwsgi and nginx is invoked from my virtualenv root using

bin/uwsgi -p 2 --socket  127.0.0.1:8807 --module index --pythonpath ironjob/ai -d log/uwsgi_ai.log
bin/nginx -p ./ -c ironjob/etcs/production/nginx.conf

this is my nginx.conf file

server {
    listen      8090;
    server_name example.com;
    charset     utf-8;

    # Django admin media.
    location /media/admin/ {
      alias lib/python2.6/site-packages/django/contrib/admin/media/;
    }
    # Your project's static media.
    location /media/ {
      alias PROJECT_ROOT/media/;
    }

    # Finally, send all non-media requests to the Django server.
   location /ai {
      uwsgi_pass  127.0.0.1:8807;
      include     uwsgi_params;
    }
  }

and the $VIRTUVAL_ENV/ironjob/ai/index.py file that contains the callable application:

import os
import sys
from webob import Response
from cgi import parse_qs, escape
import urllib

from ironMainManager import MainManager

os.environ['PYTHONJ_EGG_CACHE'] = '$VIRTUAL_ENV/bin/.python-egg'

def application(environ , start_response):
    mManager = MainManager()
    parameters = parse_qs(environ.get('QUERY_STRING', ''))
    returnval ="<Root></Root>"

    if 'api' in parameters:
        api = parameters['api'][0]
        if 'platform' in parameters:
                platform = parameters['platform'][0]
                if platform == 'browser':
                       api = urllib.unquote(str(parameters['api'][0]))
        print api
        returnval = mManager.process(api)
        output = 'success'
    else:
        output = 'error'

    res = Response()
    res.content_type = 'text/plain'
    res.body=str(returnval)
    return res(environ, start_response)

It looks like you have an old uWSGi instance already running. Be sure to kill all of the remaining instances and restart uWSGI. In addition to this try to always use the latest stable (1.0 is pretty old now)