VS Code Integrated Terminal Throws `Cannot find module` & `nvm is not compatible with the npm config "prefix" option`

I had this problem and I was just able to fix my issues by disabling auto attaching for debug in the VSCode settings. Hopefully I can re-enable this in the future since you mentioned there aren't issues with the latest insider release. I'm using a Bash shell by the way but hopefully this will help you as well.

"debug.node.autoAttach": "disabled",