Wordpress redirect loop on site root. Nginx proxy apache

[admin]

I'm setting up Nginx as a proxy to apache2 serving a Wordpress installation. Issue is that on the root url appsrd.devmbs.com im getting a redirect loop. When I hit the server I see the following in the logs like 12-15 times.

127.0.0.1 - - [03/Sep/2012:12:29:25 +0000] "GET /index.php HTTP/1.0" 301 529 "http://appsrd.devmbs.com/wp-admin/options-general.php" "Mozilla/5.0 (Macintosh; Intel Mac OS X 10_8_0) AppleWebKit/537.1 (KHTML, like Gecko) Chrome/21.0.1180.89 Safari/537.1"

But the /wp-admin works well. No redirect issue. I tried deleting the database, and while the db wasn't available the root displayed a msg of Error establishing a database connection which is fine since this is the expected behavior but there was no redirect issue. Then I created the DB again and ran the wordpress setup, and when everything is done, the redirect issue comes back.

Beloe my nginx server conf:

server {
        listen       80 default_server;
        server_name  appsrd.devmbs.com;
        root /home/ubuntu/projecs/APPS-RD;
        #charset koi8-r;

        #access_log  logs/host.access.log  main;

        location / {
            root   /home/ubuntu/projects/APPS-RD;
            index  index.html index.htm index.php;
        }

        error_page   500 502 503 504  /50x.html;
        location = /50x.html {
            root   html;
        }

        location ~ \.php$ {
        proxy_pass   http://127.0.0.1:3000;
        proxy_buffering on;
        proxy_buffers 12 12k;
        proxy_set_header Host $host;
        }
}

The url is appsrd.devmbs.com, appsrd.devmbs.com/wp-admin works fine.

Anyone have a clue what might be happening?