The second Web Services cache option is fine - api2.xml was introduced in 1.7, it’s the new REST API.
I’ve seen this kind of thing happen before from having symlinks disabled - assuming you use symlinks for your theme or something. But of course there’s no reason that an upgrade should cause that if it wasn’t happening before - but just check that.
I’m sure you’ve already checked to make sure developer_mode is on, display_errors is on, logging is enabled, and you’ve cleared cache a couple few times for good measure. By the way, try simply deleting the var/cache/ directory - there is some DB schema stuff that won’t get cleared by Flushing Cache through the admin.
Check your PHP error log if you don’t have anything in system or exception.
And of course, if you’re able to revert back to a fresh version of your staging instance prior to the upgrade, I’d go ahead and do that just to sanity check things.
p.s. We both have exactly 126 posts at the time of this posting. Interesting