[FEATURE] VS Code extension: collapse large pasted text like terminal CLI does

Preflight Checklist

• [x] I have searched existing requests and this feature hasn't been requested yet
• [x] This is a single feature request (not multiple features)

Problem Statement

In the terminal CLI, pasting large text collapses it into a neat pill/badge ([pasted_text_blah]), keeping the conversation readable.

In the VS Code extension, the same paste renders inline in full, making long pastes (error logs, stack traces, code) very hard to work with.

Proposed Solution

Request: Bring the same paste-collapsing behavior to the VS Code extension — collapse large pastes into a clickable pill that can be expanded on demand.

The terminal CLI already solved this elegantly. Would love to see parity in the VS Code UI.

Alternative Solutions

_No response_

Priority

Medium - Would be very helpful

Feature Category

Other

Use Case Example

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Additional Context

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