You do not need to add
AllowOverride All, telling apache to avoid IO by checking existence of
.htaccess files in current directory and all parents directories with
AllowOverride None is a good recipe for speed. Avoid
.htaccess files if you can edit Apache configuration.
FallbackResource is a quite new feature and may have some bugs. Did you check the ErrorLog for details? Could you try that with
It seems you problems is with directories, maybe you could fix it by enforcing usage of your fallback when a Directory is requested, try to add: