VS Code extension: diff snapshot fails on Windows with fs/readDirectory path error

Summary

The Codex VS Code extension cannot open its diff/review view. Every attempt to create a diff snapshot fails before the diff is displayed.

Environment

• OS: Windows 11 x64 (10.0.28000)
• VS Code: 1.131.0, commit e4c7e7b1d6d060162f4aa7f8225271b67ce1df75
• Codex extension: openai.chatgpt 26.727.40816 (Win32 x64)
• The bundled Codex app-server is running normally.

Steps to reproduce

1. Open a local Git repository in VS Code.
2. Start or resume a Codex chat.
3. Trigger the Codex diff/review visualization for a turn with file changes.

Actual behavior

The diff UI fails to open. The extension log records, in this order:

Request failed ... method=fs/readDirectory ... message="The system cannot find the path specified. (os error 3)"
Failed to start visualization turn diff snapshot error={}

The editor diff webview then hits its error boundary.

Expected behavior

Codex should create the turn diff snapshot and open the review/diff UI.

Diagnostics already attempted

• Fully restarted VS Code: no change.
• Opened the actual Git repository directly instead of its non-Git parent directory: no change.
• Verified VS Code CLI, the workspace, and repository directories are readable; code --status reports the opened folder normally.
• Forced installation of openai.chatgpt; it reports the extension is already installed, and the issue remains.
• This has reproduced repeatedly across many Codex turns since 2026-07-31.

No repository source, credentials, or complete session logs are attached. I can provide additional sanitized logs if needed.