[BUG] v2.1.117 extension fails to activate on Windows — "command not found"

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?

After the extension auto-updated to version 2.1.117, the Claude Code extension no longer activates in VS Code. Specifically:

1. The Claude Code sidebar icon (Spark) does not appear.
2. Runtime Status in the extension page shows "Not yet activated".
3. Running any Claude Code command from the Command Palette (e.g. Claude Code: Open in New Tab) fails with:

``
command 'claude-vscode.editor.open' not found
``

1. The CLI itself works fine — running claude in the integrated terminal connects and functions normally. The problem is strictly with the VS Code extension activation.

What Should Happen?

Extension should activate normally after auto-update, the sidebar icon should appear, and all commands should be registered.

Error Messages/Logs

Extension should activate normally after auto-update, the sidebar icon should appear, and all commands should be registered.

Steps to Reproduce

1. Have Claude Code extension working on a previous version (e.g. 2.1.116).
2. Let Auto Update install version 2.1.117.
3. Reload VS Code window / restart VS Code.
4. Observe the sidebar icon is missing and commands are not registered.

Claude Model

None

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

2.1.117

Platform

Anthropic API

Operating System

Windows

Terminal/Shell

Terminal.app (macOS)

Additional Information

Workaround

Downgrading to the previous version fixes the issue immediately:

1. In the Extensions view, click the dropdown next to Uninstall → Install Another Version
2. Select a previous version (e.g. 2.1.116)
3. Reload window
4. Extension activates correctly, sidebar icon reappears, commands work

Disabling Auto Update is required to keep the working version.

Expected Behavior

Extension should activate normally after auto-update, the sidebar icon should appear, and all commands should be registered.

Additional Notes

This appears to affect other users as well — the 2.1.117 release seems to have a broken activation flow on Windows native installs.