Edit tools (edit_existing_file, single_find_and_replace) fail when workspace is connected via Remote SSH

Before submitting your bug report

• I've tried finding an answer on the Continue docs site
• I'm not able to find an open issue that reports the same bug
• I've seen the troubleshooting guide on the Continue Docs

Relevant environment info

- Continue extension version: 1.3.40
- VS Code version:  Version: 1.124.2 
- OS: Windows_NT x64 10.0.26200
- Connection type: Remote – SSH (via ms-vscode-remote.remote-ssh)
- Remote OS: Linux (Ubuntu 22.04)
- Local OS: Windows 11

Description

1. Open a folder in VS Code using Remote – SSH.
2. Install and activate the Continue extension.
3. Open a simple text file, e.g., e.php containing only 123456789.
4. Ask Continue to edit the file, for example: "Add 10 to the number" or "Replace content with 123456799".
5. The agent attempts to use edit_existing_file, single_find_and_replace, or run_terminal_command to modify the file.

Observed Behavior

• edit_existing_file fails with:
  Failed to edit undefined. To continue working with the file, read it again to see the most up-to-date contents
• single_find_and_replace fails with:
  string old_string is required (even though the argument is correctly provided).
• create_new_file fails with:
  contents argument is required. (type string) (again despite providing the argument).
• run_terminal_command executes without error but the file is not actually modified (e.g., echo 123456799 > movie.php has no effect; view_diff shows empty diff).
• read_file and file_glob_search work correctly and show the original content.

Expected Behavior

All edit tools should modify file content in a remote SSH workspace exactly as they do in a local workspace.

Additional Notes

The problem appears to be related to file path resolution or write-permissions when the workspace is accessed via Remote – SSH. The agent can read files but cannot write them, which severely limits functionality in remote development environments.

To reproduce

No response

Log output

Start by reproducing the failure in a VS Code Remote–SSH workspace with edit_existing_file, single_find_and_replace, create_new_file, and run_terminal_command, then compare the same operations locally. Trace how these tools resolve paths and write files, using read_file and file_glob_search as working references. Done means all listed edit tools modify remote files and view_diff shows the changes.