Rtools not being detected by R
Solution 1:
Turns out when I installed RTools I left out the R 2.15.x+ toolchain option in the installation, which lead to the gcc never being installed. Hopefully, this post will serve as a diagnostic guide if RStudio fails to register RTools.
Thank you everyone for your help.
Solution 2:
The RTools install on Windows doesn't select the C compiler to include by default. I ran the install a few times blindly clicking through and got this error. I reran the installer and selected/included the 32bit and 64bit C compilers. Problem solved.