Make the Cinnamon Roll Dough : Warm the milk until it’s lukewarm (not hot) and combine it with the yeast in a mixing bowl. Let sit for 5 minutes until frothy. Add the applesauce, butter, sugar, and salt to the yeast mixture, then gradually mix in the flour. Knead the dough for about 7-10 minutes until smooth. Cover the dough with a damp cloth and let it rise in a warm spot for about 1 hour, or until it doubles in size.
Prepare the Apple Filling : In a large skillet, melt butter over medium heat. Add the diced apples, brown sugar, cinnamon, and salt. Cook until the apples are softened (about 10 minutes). Mix water and cornstarch in a small bowl to create a slurry. Stir it into the apple mixture, cooking until thickened. Remove from heat and let cool.
Make the Caramel Sauce : Heat sugar in a saucepan over medium heat, stirring continuously until it melts into a golden caramel. Add butter and mix until fully incorporated, then slowly stir in the heavy cream and salt. Let cool to room temperature.
Assemble the Rolls : Roll out the dough into a large rectangle (about 12x16 inches). Spread the softened butter over the surface, then evenly distribute the apple filling on top. Roll the dough tightly into a log and slice into 12 equal pieces. Place the rolls in a greased baking dish, cover, and let rise for 30 minutes.
Bake the Rolls : Preheat the oven to 350°F (175°C). Bake the rolls for 25-30 minutes, or until golden brown.
Make the Caramel Cream Cheese Icing : Beat the cream cheese and butter until fluffy. Add the caramel sauce, vanilla extract, salt, and powdered sugar. Mix until smooth.
Glaze and Serve : Spread the caramel cream cheese icing over the warm cinnamon rolls. Drizzle with extra caramel sauce for a finishing touch and serve!