prj,
The "normal" dalvik-cache is located in /data/dalvik-cache. I'm pretty sure that the presence of a dalvik-cache directory under the /cache directory is a result of flashing a ROM (like xtrSense) that has moved dalvik-cache from /data to /cache (giving you more room for apps by freeing-up /data).
I believe that a "Wipe Dalvik-cache" in Amon_RA's custom recovery will only wipe the /data/dalvik-cache and would suspect that the ROMs that have supported moving dalvik-cache from /data to /cache would have to have a process for managing this.
The Tazz (2.0) ROM that I have been using lately has a "split personality" - BOTH caches are used by the ROM:
/data/dalvik-cache <== Used by market apps (stored in /data/app)
/cache/dalvik-cache <== Used by pre-installed System apps (stored in /system/app)
I don't know if that is something which is specific to Tazz or is in every CyanogenMod 6 ROM, but the point is that it appears that
both of them are in use for that ROM.
As far as I know, the "Wipe dalvik-cache" menu entry in Amon_RA
ONLY wipes /data/dalvik-cache.
OTOH, the "Wipe data/factory reset" menu entry in Amon_RA appears to wipe
BOTH the /data and /cache partitions. (It sure says that it is doing just that). Note that this also means that nonsense such as "double wiping" or performing "both a data/factory reset wipe and a Dalvik cache wipe" are merely vodoo operations.
I interpret those facts to mean that it is always better to simply use the "Wipe data/factory reset" when installing a new ROM - and completely ignore the "Wipe dalvik cache" menu entry, unless you are sure of the specifics of the ROMs you are dealing with.
eu1