Marx & Engels, of course, use "Middle Class" to refer to the big bourgeoisie, the core capitalist class. The terminology was a leftover from feudal relations, the upper class being the feudal aristocracy.
In 1999 the answer to "What is the Middle Class" is that it doesn't exist, it is a figment of establishment sociology, grounded in Weber's attempt to subvert marxian class analysis with the myth of "statuses." The WSJ uses "middle class" to refer to unionized factory workers. For example, one of their columnists a few years ago, attacking the postal service, described it as the last government-subsidized middle class wage -- the implication being that once the post office was privatized there would be no more middle-class wage but all those peons out there would be reduced to their proper beggary.
Carrol