> Do you still upload your code via FTP directly to the web server?

It's pretty rare that this is even an option, since no one in their right mind would set up an FTP server with access to anything important.

SFTP? I don't see why not. No need to make things more complex than is necessary.

I don't remember any particular problems with code caching when I did PHP development, though maybe you use a different caching tool than I did. Also, Wordpress is its own beast, and is generally reviled by most everyone, expecially PHP programmers.