That error message is being emitted by the agent, not the master. Run the agent with the --debug flag to get the most detailed information available, but it looks like you may already be doing that.
That doesn't look like a Puppet error message, however. Puppet doesn't have a sense of "initializing" classes, nor really of "instantiating" them. The latter, especially, is an OO concept, and Puppet's "classes" are not classes in the OO sense.
I would guess, therefore, that the error is being emitted at a lower level of the software stack, probably in Ruby itself. If it's there then it could arise from a Puppet bug, a Ruby bug, or an incompatibility between Puppet and your Ruby implementation. Which Ruby is that, by the way?
John