Expect to be able to selecting a folder when clicking remote

### Description

See picture. When clicking on the remote machine, I expect to be able to select a folder on the remote machine, not get the options menu in picture 2.

### Issue Details

Item|Value
---|---
Issue Category|Bug
Target|Agents Window
VS Code Version|Code - Insiders 1.138.0-insider (60ac69b364809ee6976d6dc3ed74cc7628f637da, 2026-09-11T07:31:23Z)
OS Version|Darwin arm64 25.6.0

System Info

Item|Value
---|---
VS Code Version|Code - Insiders 1.138.0-insider (60ac69b364809ee6976d6dc3ed74cc7628f637da, 2026-09-11T07:31:23Z)
OS Version|Darwin arm64 25.6.0
CPUs|Apple M4 (10 x 2400)
GPU Status|2d_canvas: enabled
GPU0: VENDOR= 0x106b [Google Inc. (Apple)], DEVICE=0x0000 [ANGLE (Apple, ANGLE Metal Renderer: Apple M4, Version 26.6.2 (Build 25G83))], DRIVER_VENDOR=Apple, DRIVER_VERSION=26.6.2 *ACTIVE*
Machine model name: Mac
Machine model version: 16.12
direct_rendering_display_compositor: disabled_off_ok
gpu_compositing: enabled
multiple_raster_threads: enabled_on
opengl: enabled_on
rasterization: enabled
raw_draw: disabled_off_ok
skia_graphite: enabled_on
trees_in_viz: disabled_off
video_decode: enabled
video_encode: enabled
webgl: enabled
webgpu: enabled
webnn: disabled_off
Load (avg)|2, 2, 2
Memory (System)|32.00GB (0.37GB free)
Process Argv|--enable-proposed-api lszomoru.lszomoru-proposed-api-sample --enable-proposed-api donjayamanne.kusto --crash-reporter-id ef10dfea-3602-4c74-ba1a-109ce7da7825
Screen Reader|no
VM|0%
User Agent|Mozilla/5.0 (Macintosh; Intel Mac OS X 10_15_7) AppleWebKit/537.36 (KHTML, like Gecko) Code-Insiders/1.138.0-insider Chrome/148.0.7778.280 Electron/42.10.0 Safari/537.36
Installation pure|true

### Attachments