"It depends."

Is he is a super-TAGG-camper that isn't capable of raising without a very strong hand under these circumstances? Is he a guy that will raise in LP when it's folded to him with any two? Is he a guy that will raise in LP when folded to him only with above aveage holdings (meaning your AQ is good here)?

Me says RERAISE and see what he does and c-bet the flop when he flat calls. If he reraises you at any point he's not 'effing around and you can fold here.

I too, like Fnord, have folded here many of times. It all depends on the situation, the player you're playing, and how ballsy you're feeling. A reraise and a c-bet (or check-raise) will tell him that YOU aren't 'effing around...Unless he has something (or if he's dumb) he will fold like a cheap suit....unless he's got the goods, and he'll "tell you" when he does.