[Bug] Active sessions become unresponsive and past conversations fail to load since v2.1.x update (VS Code Extension)

Bug Description

Since the latest Claude Code VS Code extension update, active sessions randomly become unresponsive mid-conversation, and past conversations cannot be reliably accessed.

Steps to Reproduce

1. Start a new Claude Code session in VS Code
2. Work normally within the session (prompts, tool calls, etc.)
3. Receive a compacting summary (context compression)
4. Leave the session idle for some time (e.g., a few hours)
5. Return and try to submit a new prompt in the same session
6. Result: The session does not respond. No output, no error, no spinner — it simply does nothing.

Additionally — Past Conversations broken:

1. Open the "Past Conversations" dropdown
2. Result (A): Past sessions are either not listed at all, or fail to load in the dropdown
3. Result (B): If a past session does load and you select it, submitting a new prompt inside that session also produces no response — the session is effectively dead

Expected Behavior

• Active sessions should remain responsive after compacting/idle periods as long as the context window is not exhausted
• Past conversations should reliably load and allow continued interaction

Actual Behavior

• Active sessions silently die after idle periods (no error message, no compacting — just unresponsive)
• Past conversations dropdown is unreliable (sessions missing or not loading)
• Reopened past sessions also do not accept new prompts

Troubleshooting Already Attempted

• Complete uninstall and reinstall of the Claude Code extension — no improvement
• VS Code is fully up to date
• No other extensions interfering (tested with extensions disabled)

Environment

| Component | Version |
|-----------|---------|
| OS | Windows 10 24H2 Enterprise (x64) |
| VS Code | 1.109.0 (bdd88df0) |
| Claude Code Extension | v2.1.37 |
| Node.js | v22.21.0 |
| npm | 11.6.2 |
| Claude Model | claude-opus-4-6 |

Impact

This is a workflow-blocking issue. Reliable long-running sessions and the ability to resume past conversations are critical for productive use of Claude Code. Since this update, the extension cannot be used dependably for extended work sessions.

Additional Context

• The issue appeared after the most recent extension update (current: v2.1.37)
• It is not related to context window limits — sessions die well before any limit is reached
• No error messages appear in the VS Code output panel or developer console at the time of failure