Change wordpress URL without changing directory on disk

I currently have a wordpress blog http://blog.whyspam.me recently i learned that this adds no page rank to whyspam.me so i would like to transition to http://whyspam.me/blog. On my server I have a fully functioning ruby on rails app in my public_html/whyspam.me directory and would like to keep the current wordpress app installed on disk at public_html/blog.whyspam.me to keep my deployment scenario the same. I’ve tried to do this simply by modifying my NGINX server settings to the correct root but this results in a 404 page on whyspam.me/blog but i get no error log in NGINX, so I don’t know why it cannot find my content.

Is this a valid approach? Can this be done, thoughts or suggestions welcome.