In a small saucepan, heat half-and-half to 175°; stir in the sugar. Cool quickly by placing pan in a bowl of ice water; stir for 2 minutes. Stir in whipping cream and extracts. Fill cylinder of ice cream freezer two-thirds full; freeze according to manufacturer's directions. During the last 5 minutes, add half of the syrup and walnuts. Refrigerate remaining mixture until ready to freeze; repeat the process, adding remaining syrup and walnuts. Transfer to a freezer container; freeze for 2-4 hours before serving. In a heavy saucepan over medium heat, melt caramels with milk. Stir in chocolate chips until melted. Stir in cream until blended. Remove from the heat. Stir in walnuts and vanilla. Serve warm over ice cream. Refrigerate leftover sauce. Yield: 1 quart ice cream (2 cups sauce).