For the cake: Preheat the oven to 325 degrees F. Generously grease and flour a 9- or 10-inch Bundt pan.
Mix together the flour, cinnamon, baking soda, nutmeg and salt in a medium bowl. Set aside. Peel, core and dice 3 cups apples. Set aside.
Blend the oil, sugars and vanilla in a bowl with a handheld electric mixer or in a stand mixer until well mixed. Add the eggs one at a time, mixing well after each addition. Stir in the dry ingredients until just incorporated. The batter will be very thick. Fold in the apple pieces. Spoon the batter evenly into the prepared pan.
Bake the cake until a toothpick inserted in the center comes out with only a few moist crumbs, about 1 hour 15 minutes. Let cool for 20 to 30 minutes, then remove the cake from the pan to a cooling rack.
For the caramel sauce: Meanwhile, heat the caramels and milk in a saucepan on medium-high heat, stirring constantly, until the caramels are completely melted and the sauce is smooth, about 2 minutes. Let cool for 1 to 2 minutes, then drizzle over the cake just before serving.