Preheat your oven to 350°F (175°C) and grease four 8-inch round cake pans.

In a medium bowl, whisk together flour, baking powder, salt, and spices.

In a large bowl, cream together butter and oil, then mix in applesauce and sugar until smooth. Add eggs and vanilla.

Gradually add dry ingredients to wet ingredients, alternating with milk. Stir gently until just combined.

Fold in chopped apples until evenly distributed in the batter.

Divide the batter into prepared pans and bake for 20-25 minutes until a toothpick comes out clean.

Let the cakes cool in the pans for 10-15 minutes, then remove them to a wire rack to cool completely.

For the frosting, beat butter and vanilla until smooth; gradually mix in caramel and cinnamon, followed by powdered sugar until fluffy.

Level the cooled cakes with a serrated knife for even stacking and spread buttercream between layers.

Apply a crumb coat of buttercream around the cake and chill in the freezer for 15 minutes.

Frost the entire cake with remaining buttercream and create a smooth finish.

Decorate with caramel drizzle and apple slices if desired, then slice and serve.