Does this issue occur when all extensions are disabled?: Yes/No

• VS Code Version: 1.80.1
• OS Version: Mac OS 13.4.1

Steps to Reproduce:

1. Set up extension
2. Use Developer: Install Extension From Location to install the extension from the root path of the extension (the one with package.json etc)
3. Package the extension into vsix
4. Use Developer: Install Extension From VSIX and select the newly created vsix (this file can be anywhere)
5. The extension directory gets deleted