Running a local terminal through WSL using Terminal: Create New Terminal (Local) fails

[Jademalo]

Issue Type: Bug

When running Terminal: Create New Terminal (Local) in a WSL remote, it throws the error The terminal process failed to launch: Path to shell executable "\mnt\c\Windows\System32\WindowsPowerShell\v1.0\powershell.exe" does not exist. This seems strange, since for some reason it's overriding the local terminal with the one specified in terminal.integrated.profiles.linux. If I remove the WSL Host profiles specified in terminal.integrated.profiles.linux, then this command correctly runs a local PowerShell with the alert ⚠ : This shell is running on your local machine, NOT on the connected remote machine

Extension version: 0.64.2
VS Code version: Code 1.65.2 (c722ca6c7eed3d7987c0d5c3df5c45f6b15e77d1, 2022-03-10T14:33:55.248Z)
OS version: Windows_NT x64 10.0.22000
Restricted Mode: No
Remote OS version: Linux x64 5.10.16.3-microsoft-standard-WSL2

System Info

Item	Value
CPUs	Intel(R) Core(TM) i7-8086K CPU @ 4.00GHz (12 x 4008)
GPU Status	2d_canvas: enabled gpu_compositing: enabled multiple_raster_threads: enabled_on oop_rasterization: enabled opengl: enabled_on rasterization: enabled skia_renderer: enabled_on video_decode: enabled vulkan: disabled_off webgl: enabled webgl2: enabled
Load (avg)	undefined
Memory (System)	31.84GB (13.92GB free)
Process Argv	--crash-reporter-id 75d2bff3-b4ef-4cb2-9b19-e7eeeba2b392
Screen Reader	no
VM	0%

Item	Value
Remote	WSL: Ubuntu
OS	Linux x64 5.10.16.3-microsoft-standard-WSL2
CPUs	Intel(R) Core(TM) i7-8086K CPU @ 4.00GHz (12 x 4008)
Memory (System)	15.55GB (14.70GB free)
VM	0%

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