gsub wrapper re-submitted

[Hector]

Help!

How do I get $1, $2, and $3 to get interpolated in the following
snippet?

string = 'This is a test of the emergency'
regexp = Regexp.new('(\W)+(\w\w)(\W)+')
replacement = '$1->$2<-$3'
user_wants_upcase=FALSE

# Note: All variables above are set by the user of the program, so I
don't know
# what they will contain before runtime.

string.gsub!(regexp) {
return_value = replacement # Here, how do I get $1, $2, and $3 to
interpolate?

if (user_wants_uppercase)
return_value.upcase! || return_value
end

return_value
}

I want return_value to be -> 'This ->is<- a test ->of<- the emergency'

Note: I know that I can get it to work with the non-block version of
gsub! but I need to use the block version.

Thanks

Hector