Unable to create new profile from the Default one when using WSL2

[filiptrplan]

Does this issue occur when all extensions are disabled?: Yes

• VS Code Version: 1.94.2
• OS Version: Ubuntu 22.04 WSL2

I want to mention that the issue #224788 still persists in the new versions of VSCode.

Steps to Reproduce:

1. Open the Profiles UI
2. Duplicate the Default profile
3. Click Create

It doesn't create the profile, just shows the loading bar for less than a second and then its as if nothing happened.

https://github.com/user-attachments/assets/19a45cc3-8e3a-4295-9ad5-9cd9c9382889