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

• VS Code Version: 1.99.3
• OS Version: Darwin 24.3.0

Steps to Reproduce:

1. Create any directory suffixed ".Template"
2. Attempt to open this directory via File->Open Folder in VSCode

When performing these steps, the Open Folder dialog closes but no visible change occurs in the VSCode application, it simply remains on whatever was already open, neither opening the new folder nor giving any sort of feedback that it did not do as requested.

Worth noting, opening said directory by passing it as an argument to "code" on the command-line does work, so the path is a standard UNIX directory listing out a series of files that can be viewed in the file tree in VSCode. For some reason it simply refuses to open if it is suffixed ".Template". This does not appear to happen outside of macOS.