Heat the milk until pleasantly warm to the touch (it's best to check its temperature with a thermometer, it should be 100-110°F (38-43°C)). The milk can't be too cold or too hot or the yeast won't work.
1 cup (240g) milk
Add yeast to the milk (fresh yeast or instant yeast or active dry yeast), stir until yeast is dissolved (if using fresh yeast, add 1 Tbsp of sugar to the milk). If using fresh yeast or active dry yeast, set the milk aside for about 10-15 minutes. You should see foam on top of the milk (if there is no foam, you need to start over). If you're using instant yeast, there is no need to wait.
20 g fresh yeast or 1 packet/7g active dry yeast or instant yeast
Add the yeast with milk and all the other ingredients except apples to a large bowl. Mix with an electric mixer for about 3-4 minutes.
2 cups (250g) flour, 2 large eggs, 1/4 cup (50g) sugar, 2 teaspoons vanilla extract, 1/4 teaspoon cinnamon, 1/4 teaspoon fine sea salt
Cover the bowl with a piece of plastic foil or kitchen towel and set aside in a warm place until doubled in volume, this should take 45-60 minutes (I'm putting it in a turned off oven with a light on and my dough always needs 45 minutes to double its volume).
Peel and core the apples, cut into very small cubes. Add the apples to the dough and stir until evenly distributed. Set aside for 5-10 minutes.
5 small/medium apples
Heat about 3 tablespoons of oil in a non-stick frying pan over medium heat (you can add more or less oil, sadly, more oil = better-tasting pancakes). The oil should be well-heated otherwise the pancakes will soak up fat, you should hear sizzling while adding batter to the pan.
Spoon about 1-2 heaped tablespoons of batter (1/4 cup) per pancake. Cook on both sides until puffy and golden. Transfer to a cooling rack lined with paper towels. Cut one pancake in half to make sure it's cooked through in the middle (there is no raw batter). Don't put anything on the pancakes or they won't remain crispy. Repeat with the remaining dough.
Dust the pancakes with powdered sugar and serve.
Enjoy!