[Bug] Terminal rendering issues: typing bar disappears and text overflows display

Bug Description
Last few releases rendering has had lots of challenges.
The typing bar dissapears often - sometimes it does not but the text overruns past it.

Further, the rending of text in the view is now way off. It seems it's printing with odd colored characters:

<img width="672" height="362" alt="Image" src="https://github.com/user-attachments/assets/f663bedf-fb62-46cf-9c15-c66eecc4a20f" />

Then if I highlight - different rendering issues:
<img width="682" height="419" alt="Image" src="https://github.com/user-attachments/assets/d4f06ed8-7f79-4e2f-8478-a9c9f3a5b46b" />

Environment Info

• Platform: darwin
• Terminal: vscode
• Version: 2.1.29
• Feedback ID: 99f22839-80c7-49dd-bae0-66d27484b3e5

Errors

[{"error":"Error: {\"message\":\"Operation timed out.\",\"originalLine\":\"188\",\"originalColumn\":\"112927\",\"line\":\"188\",\"column\":\"112927\",\"sourceURL\":\"/$bunfs/root/claude\",\"stack\":\"Error: Operation timed out.\\n    at <anonymous> (/$bunfs/root/claude:188:112927)\",\"name\":\"Error\"}\n    at error (/$bunfs/root/claude:1722:25028)\n    at <anonymous> (/$bunfs/root/claude:188:42062)\n    at ZZD (/$bunfs/root/claude:188:42606)\n    at <anonymous> (/$bunfs/root/claude:189:16930)\n    at processTicksAndRejections (native:7:39)","timestamp":"2026-02-02T08:12:11.748Z"},{"error":"Error: 1P event logging: 2 events failed to export (code=ECONNABORTED, timeout of 10000ms exceeded)\n    at queueFailedEvents (/$bunfs/root/claude:202:2350)\n    at async doExport (/$bunfs/root/claude:202:1257)\n    at processTicksAndRejections (native:7:39)","timestamp":"2026-02-02T08:12:11.867Z"},{"error":"Error: {\"message\":\"Failed to export 2 events (code=ECONNABORTED, timeout of 10000ms exceeded)\",\"originalLine\":\"202\",\"originalColumn\":\"1409\",\"line\":\"202\",\"column\":\"1409\",\"sourceURL\":\"/$bunfs/root/claude\",\"stack\":\"Error: Failed to export 2 events (code=ECONNABORTED, timeout of 10000ms exceeded)\\n    at doExport (/$bunfs/root/claude:202:1409)\\n    at processTicksAndRejections (native:7:39)\",\"name\":\"Error\"}\n    at error (/$bunfs/root/claude:1722:25028)\n    at <anonymous> (/$bunfs/root/claude:188:42062)\n    at ZZD (/$bunfs/root/claude:188:42606)\n    at <anonymous> (/$bunfs/root/claude:189:17366)\n    at processTicksAndRejections (native:7:39)","timestamp":"2026-02-02T08:12:11.868Z"},{"error":"Error: {\"message\":\"Operation timed out.\",\"originalLine\":\"188\",\"originalColumn\":\"112927\",\"line\":\"188\",\"column\":\"112927\",\"sourceURL\":\"/$bunfs/root/claude\",\"stack\":\"Error: Operation timed out.\\n    at <anonymous> (/$bunfs/root/claude:188:112927)\",\"name\":\"Error\"}\n    at error (/$bunfs/root/claude:1722:25028)\n    at <anonymous> (/$bunfs/root/claude:188:42062)\n    at ZZD (/$bunfs/root/claude:188:42606)\n    at <anonymous> (/$bunfs/root/claude:189:16930)\n    at processTicksAndRejections (native:7:39)","timestamp":"2026-02-02T08:22:19.756Z"},{"error":"Error: 1P event logging: 2 events failed to export (code=ECONNABORTED, timeout of 10000ms exceeded)\n    at queueFailedEvents (/$bunfs/root/claude:202:2350)\n    at async doExport (/$bunfs/root/claude:202:1257)\n    at processTicksAndRejections (native:7:39)","timestamp":"2026-02-02T08:22:19.867Z"},{"error":"Error: {\"message\":\"Failed to export 2 events (code=ECONNABORTED, timeout of 10000ms exceeded)\",\"originalLine\":\"202\",\"originalColumn\":\"1409\",\"line\":\"202\",\"column\":\"1409\",\"sourceURL\":\"/$bunfs/root/claude\",\"stack\":\"Error: Failed to export 2 events (code=ECONNABORTED, timeout of 10000ms exceeded)\\n    at doExport (/$bunfs/root/claude:202:1409)\\n    at processTicksAndRejections (native:7:39)\",\"name\":\"Error\"}\n    at error (/$bunfs/root/claude:1722:25028)\n    at <anonymous> (/$bunfs/root/claude:188:42062)\n    at ZZD (/$bunfs/root/claude:188:42606)\n    at <anonymous> (/$bunfs/root/claude:189:17366)\n    at processTicksAndRejections (native:7:39)","timestamp":"2026-02-02T08:22:19.868Z"},{"error":"Error: {\"message\":\"Operation timed out.\",\"originalLine\":\"188\",\"originalColumn\":\"112927\",\"line\":\"188\",\"column\":\"112927\",\"sourceURL\":\"/$bunfs/root/claude\",\"stack\":\"Error: Operation timed out.\\n    at <anonymous> (/$bunfs/root/claude:188:112927)\",\"name\":\"Error\"}\n    at error (/$bunfs/root/claude:1722:25028)\n    at <anonymous> (/$bunfs/root/claude:188:42062)\n    at ZZD (/$bunfs/root/claude:188:42606)\n    at <anonymous> (/$bunfs/root/claude:189:16930)\n    at processTicksAndRejections (native:7:39)","timestamp":"2026-02-02T08:39:11.765Z"},{"error":"Error: 1P event logging: 1 events failed to export (code=ECONNABORTED, timeout of 10000ms exceeded)\n    at queueFailedEvents (/$bunfs/root/claude:202:2350)\n    at async doExport (/$bunfs/root/claude:202:1257)\n    at processTicksAndRejections (native:7…

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