Cool! I am able to reach smtp.gmail.com - that was a clever idea. Mailgun is definitely blocking that particular IP address. Mailgun support is not being so helpful so I still may start over with a new IP address next week.
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I moved my site to a new hetzner server where email works as expected. Who knows what I did to bork email! Thanks everyone who helped out. I learned something about troubleshooting from this experience anyway so not a complete waste of time.
Mailgun support is pretty certain the issue was local to the server. They say they were not seeing any activity from the affected IP and were not proactively blocking the IP.
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Если кто-то столкнулся с этой же проблемой сегодня, 
извините, мы объединили обновление gem, которое, похоже, вызвало ту же проблему.
Мы считаем, что проблема возникла в:
и была исправлена в:
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