Butter 2 (8-inch) round cake pans. Line with parchment paper, then butter and flour the pans.
For the cake: Beat the sugar, oil, and eggs together in the bowl of an electric mixer fitted with the paddle attachment until light yellow. Add the vanilla. In another bowl, sift together 2 1/2 cups flour, the cinnamon, baking soda, and salt.
Add the dry ingredients to the wet ingredients. Toss the raisins and walnuts with 1 tablespoon flour. Fold in the carrots and pineapple. Add to the batter and mix well.
Divide the batter equally between the 2 pans. Bake for 55 to 60 minutes, or until a toothpick comes out clean. Allow the cakes to cool completely in the pans set over a wire rack.
For the frosting: Mix the cream cheese, butter and vanilla in the bowl of an electric mixer fitted with the paddle attachment until just combined. Add the sugar and mix until smooth.
Place 1 layer, flat-side up, on a flat plate or cake pedestal. With a knife or offset spatula, spread the top with frosting. Place the second layer on top, rounded side up, and spread the frosting evenly on the top and sides of the cake. Decorate with diced pineapple.