Unwrap the caramels from the plastic wrappers and place them in a small saucepan with the water over low heat, stirring occasionally
Cream the butter and sugars together until smooth and creamy and then beat in the egg
Add the baking powder and cinnamon and milk well
Add in the flour and milk, alternating by the 1/2 cups, until smooth and set aside
Grease an 8x8 pan with real butter
Place the sliced apples on the bottom of the pan in 1-2 layers, covering as much of the space as possible.
Once the caramels are melted and smooth, pour the caramel sauce over the apples
Evenly spread the cake batter over hte caramels and place in an oven that has been heated to 375 and bake for 30-35 minutes or until a toothpick comes out clean
Let cool for 5 minutes and then invert cake onto a plate for serving