In a bowl, combine the flour, baking powder, baking soda, cinnamon, and salt, and whisk them together. Set aside.

In the bowl of a large stand mixer,combine the brown sugar and oil, and whisk them together on medium speed until well-combined. Add the applesauce, caramel sauce, and vanilla extract, then mix well again. Add the eggs one at a time, beating well after each addition.

Finally, with the mixer running on low, add a third of the dry ingredients. Once that's mostly mixed in, add half of the buttermilk, then half of the remaining drys, then the rest of the buttermilk, and finally the rest of the drys. Stop the mixer when there are just a few streaks of flour remaining. Fold in the rest of the dry ingredients with a spatula, scraping the bottom and sides of the mixing bowl well. Add the diced apples and fold them in as well.

Divide the batter evenly between the two cake pans. Bake the cakes at 350°F for about 40 minutes, until the top springs back lightly when pressed and a toothpick inserted into the center comes out clean. Let the cakes cool at room temperature, then when they?re barely warm to the touch, invert them from the pans and let them cool completely. Wrap them well with plastic wrap and place them in the freezer for 30 minutes to firm up before cutting them and assembling the cake.

Once the cakes are firm (they do not need to be completely frozen), remove them from the freezer. Use a very long, sharp serrated knife to cut them in half through the middle, so that you have four cake rounds. If the tops are very domed, trim off the tops to make them even as well

For the Frosting: Pour whipping cream in to stand mixer. Add sugar, vanilla & caramel flavor extract.
Beat on high for 5 minutes. After whipping for 5 minutes, check to see if the whipping cream is firm enough for your cake. I like to scoop some whipping cream on to a spoon and hold it upside down. It should stay in place and not fall off the spoon.

Keep whipped cream frosting refrigerated when not in use. If after taking out of the fridge it has softened up, you may have to re-whip it for a few minutes.

Frost & decorate cake

To make the caramel apples:
Wash the apples, and dry them extremely well. Twist out the stem, and insert the lollipop sticks or wooden skewers in the top of each apple. Line a baking sheet with foil and spray the foil well with nonstick cooking spray.
Unwrap the caramels, and place them in a medium microwave-safe bowl, along with the cream or water. Microwave the caramels in 30-second increments, stirring after every 30 seconds, until it?s completely melted and smooth. Holding an apple by the stick, dip it until it is mostly submerged in the caramel. If necessary, use a spoon to spoon some caramel over the sides of the apple. Let the excess caramel drip back down in the bowl, and use the spoon to scrape the bottom of the apple to get excess caramel off. Place the apple on the baking sheet and repeat until the rest of the apples are dipped.
If the caramel pools at the bottom of the apple a bit, and you want to tidy it, wait until it?s barely warm, then wet your hands, and shape it arou