[BUG] Selecting model with /model deletes content of settings.json

Environment

• Platform (select one):
• [ ] Anthropic API
• [ ] AWS Bedrock
• [ ] Google Vertex AI
• [x] Other: Claude Max
• Claude CLI version: 1.0.43 (Claude Code)
• Operating System: macos 15.5
• Terminal: zish shell - iTerm, Ghostty, vscode terminal - same issue

Bug Description

When selecting the model with /model, everything in ~/.claude/settings.json gets replaced with model key value in case of opus or sonnet or just empty {} in default case.

So settings.json is left with just {} or

{
  "model": "<sonnet or opus>"
}

Steps to Reproduce

1. Start claude code CLI with default claude (or any flag really)
2. Select model with /model
3. Check ~/.claude/settings.json

Expected Behavior

Only model should change in settings when selecting model with /model

Actual Behavior

Any other settings that are not model selection gets removed and only model is left

Additional Context

Launching with --model <modelname> does not affect the settings.json file.