[BUG] Cowork VM service not starting on Windows 10 after v1.1.9493 update

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

Version: 1.1.9493 (b58a0b)
Platform: Windows 10 Pro / Windows

I have Claude Desktop installed on two almost identical pc's

Same error message on both pc's: "Failed to start Claude's workspace. VM service not running. The service failed to start"

CoworkVMService shows as Stopped, manual start via PowerShell succeeds but Claude Desktop cannot start/configure it
Event Log shows DCOM permission error: CLSID {2593F8B9-4EAF-457C-B68A-50F6B8EA6B54} / APPID {15C20B67-12E7-4BB6-92BB-7AFF07997402}

What Should Happen?

Cowork should work without error message

Error Messages/Logs

Version: 1.1.9493 (b58a0b)
OS: Windows 10 Pro
Affects: Multiple machines simultaneously (confirmed regression in this version)

Error shown in Cowork UI:
"Failed to start Claude's workspace — VM service not running. The service failed to start."

Diagnostic findings:
- CoworkVMService exists but is Stopped after Claude Desktop launches
- Hyper-V fully enabled (all components)
- hns and vmcompute services both Running
- Manual Start-Service CoworkVMService succeeds in PowerShell, but Claude Desktop still shows the error
- Set-Service CoworkVMService -StartupType Automatic blocked with "Access Denied" (MSIX restriction)

Event Log (System, Event ID 10016):
The application-specific permission settings do not grant Local Activation permission for the COM Server application with CLSID {2593F8B9-4EAF-457C-B68A-50F6B8EA6B54} and APPID {15C20B67-12E7-4BB6-92BB-7AFF07997402} to the user running in the application container (Unavailable SID).

cowork_vm_node.log shows:
- VM started and ran successfully on this machine under v1.1.9310
- Failures begin consistently after update to v1.1.9493
- Failure point always at "Configuring Windows VM service..." with 5-second timeout
- Error: "VM service not running. The service failed to start"

Both machines were working on v1.1.9310. Both broke on v1.1.9493.

Steps to Reproduce

typing anything in Cowork chat box triggers an error message after a few moments

Claude Model

Sonnet (default)

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

2.1.87 (Claude Code)

Platform

Anthropic API

Operating System

Windows

Terminal/Shell

PowerShell

Additional Information

<img width="834" height="511" alt="Image" src="https://github.com/user-attachments/assets/94ac2e1d-4930-48f5-9795-1d6c506b2fec" />