Task tool agent output not displaying in VS Code terminal

Environment

• Platform (select one):
• Other: Claude Code VS Code Extension
• Claude CLI version: 1.0.92 (Claude Code)
• Operating System: macOS Darwin 24.6.0
• Terminal: VS Code Integrated Terminal

Bug Description

When using the Task tool to launch agents, the agent's actual output
is not displayed in the VS Code terminal. Only the assistant's brief
summary message appears, making agent systems completely unusable.
This is a regression - the functionality was working correctly on
August 16, 2025.

Steps to Reproduce

1. Open a project with configured agents in .claude/agents/ directory
2. Execute a command that triggers the Task tool (e.g., "launch

insight engine")

1. Observe that only the assistant's wrapper message displays
2. Note that the agent's actual output (menus, responses, interactive

content) is suppressed

Expected Behavior

The full agent output should be visible in the terminal, including
formatted menus like:
🍀 Your Insight Team is ready to help! What would you like to work on
today?

## Explore & Capture Ideas

1. Have a conversation to explore what's on your mind
2. Continue a previous conversation

[... complete menu structure ...]

Actual Behavior

Only the assistant's summary message displays:
🍀 Your Insight Engine session is now active! I've presented the main
work menu showing all available options.
The actual agent output is completely hidden from the user.

Additional Context

• Agent files execute correctly (verified through Claude Code's

internal responses)

• Issue appears to be in the display/rendering layer, not agent

execution

• Affects all Task tool invocations, not just specific agents
• Fresh VS Code reinstall and Claude Code extension reinstall did not

resolve

• This completely breaks established workflows that depend on agent

interactions

• Root cause identified as Claude Code display bug, not agent

configuration issue