Shitty move (as expected from Microsoft) but I don't see the bigger issue. The beauty of open source is that you can always roll back to a version that did work. Of course continued developement and support from there on is your problem, but Microsoft never owed that to you anyways. Cursor, Codium and all the other VS Code forks have unlimited VC funding and are worth tens of billions of dollars combined. They can afford to contribute back to the ecosystem.

The C/C++ extension isn't open source though, and that's where the "doesn't work on forks" DRM is implemented. At least the clangd extension is open source and is a viable alternative.