Owin + DefaultAuthenticationTypes.ApplicationCookie + Windows Authentication - asp.net-mvc

Question

My MVC5.1 application uses OWIN authentication based on http://www.khalidabuhakmeh.com/asp-net-mvc-5-authentication-breakdown
The user persistence in db and login validation is handled by my custom UserService class. This works perfectly fine when using individual accounts for users to login into the system.
I also need to make this work with Windows Authentication (Active Directory). So if Windows auth is turned on (on IIS & a flag in my web.config) the AD user will be validated against my DB to see if the logged in user has access to my web application and if yes log him in (set the application cookie).
I enabled Windows Auth in IIS, disabled Anonymous Auth in IIS, and removed <authentication mode="None" /> from my web.config file. This makes OWIN think the user is already authenticated even though in the startup I configure it to use ApplicationCookie
app.UseCookieAuthentication(new CookieAuthenticationOptions
{
AuthenticationType = DefaultAuthenticationTypes.ApplicationCookie,
LoginPath = new PathString("/Account/Login")
});
Well this is fine, I could write a wrapper around AuthenticationManager.User.Identity.IsAuthenticated property and add the check to validate the user against my db. But then I am not able to add custom claims as OWIN doesnt seem to be using an Application Cookie but directly uses the WindowsClaimsIdentity.
My login function (the one that tries to add additional claims) is as follows:
_authenticationManager.SignOut(DefaultAuthenticationTypes.ApplicationCookie);
var identity = new ClaimsIdentity(
new[] {
new Claim(ClaimTypes.NameIdentifier, user.UserID.ToString()),
new Claim(ClaimTypes.Name, user.UserName),
new Claim(ClaimTypes.UserData, user.CurrentDomainID.ToString())
},
DefaultAuthenticationTypes.ApplicationCookie,
ClaimTypes.Name,
ClaimTypes.Role);
_authenticationManager.SignIn(new AuthenticationProperties() { IsPersistent = isPersistent }, identity);
Now If I add the line <authentication mode="None" /> in web.config it seems to be working, meaning OWIN only looks for claims inside its cookie and doesnt authenticate the user until the user exists in the DB.
But in both these cases, I am stuck in a redirect loop on the login page unless i remove login path from the startup. I tried setting Response.SuppressFormsAuthenticationRedirect=false in my login controller but no change.
Another problem I am facing is, the browser doesnt show me the login page until I enter a valid username/password in the basic auth popup even if i am logged in with my AD account in windows. Is there a way to hide this popup?