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To make the dough: In a large mixing bowl, whisk together the flour, sugar, salt, baking powder, and cinnamon.
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Work in the butter just until the mixture is unevenly crumbly; it's OK for some larger chunks of butter to remain unincorporated.
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Stir in the chopped apple and chips.
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In a separate mixing bowl, whisk together the eggs, vanilla, and applesauce.
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Add the liquid ingredients to the dry ingredients and stir until all is moistened and holds together.
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Line a baking sheet with parchment; if you don't have parchment, just use it without greasing it. Sprinkle a bit of flour atop the parchment or pan.
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Scrape the dough onto the floured parchment or pan, and divide it in half. Gently pat and round each half into a 5" to 5 1/2" circle about 3/4" thick.
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To make the topping: Stir together the coarse sugar and cinnamon. Brush each circle with water or milk, and sprinkle with the topping.
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Using a knife or bench knife that you've run under cold water, slice each circle into 6 wedges.
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Carefully pull the wedges away from the center to separate them just a bit; there should be about 1/2" space between them at their outer edges.
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For best texture and highest rise, place the pan of scones in the freezer for 30 minutes, uncovered. While the scones are chilling, preheat the oven to 425°F.
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Bake the scones for 18 to 22 minutes, or until they're golden brown. When you pull one away from the others it should look baked all the way through; the edge shouldn't look wet or unbaked.
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Remove the scones from the oven and cool briefly on the pan. Serve warm.
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Wrap any cooled leftover scones securely and store at room temperature for several days; freeze for longer storage.
