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After Installing APC Object Cache Backend transients stopped working

My understanding is that once you enable the persistent object cache, your transients are no longer stored in wp_options, but in the cache. Once I installed Mark Jaquith's APC Object Cache Backend, ...
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APC fragmention woes on Apache AWS EC2 Small instance with WordPress and W3TC

Asked this question at serverfault, and got confirmation that W3TC is most likely causing the issue, but several of my more W3TC/Wordpress specific issues weren't able to be answered. Reposting ...