I'd personally look for a language that doesn't tie you down to a platform. AFAIK C# is Windows-only, and most MUD/MUSH hosts are Linux-based these days.
I looked into Ruby once, and was disappointed to see that it didn't support native threads, meaning that it couldn't take advantage of multi-CPU systems.
From an ease of implementation viewpoint, I'd go Java, but from a performance standpoint, either C++ or C. The latter would make it easier to imbed a scripting language like Ruby, Lua, Perl, or what have you.
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