Summary

Currently, MCP server errors in the VS Code prompt area use two inconsistent patterns: a tool icon that opens a quick pick view, and a server icon that shows messages on delayed hover. This creates confusion about how to access error information and makes the interface feel unresponsive. We should consolidate these into a single, central error notification pattern.
Context/Background
Users working with MCP servers encounter errors displayed through different UI patterns in the prompt area. The inconsistency leads to:

Unclear affordances - users don't know what action to take when they see an error
Perceived broken functionality - the hover delay makes the interface feel unresponsive
Cognitive overhead - learning two different interaction patterns for the same type of information

Description

Current State:

Tool icon error: Clicking opens a quick pick view with error details (immediate feedback)
Server icon error: Hovering displays error message after a delay (delayed feedback)

Desired State:

A unified error notification system that:

• Uses a single, consistent interaction pattern for all MCP server errors
• Provides immediate, clear feedback when errors occur
• Makes it obvious to users that there are errors and how to view them
• Displays error information in a centralized location

Acceptance Criteria

• All MCP server errors use the same notification mechanism
• Error notification provides immediate visual feedback (no perceived lag)
• Users can access detailed error information through a single, consistent interaction
• Error notification clearly indicates the number and type of errors present
• Interaction pattern is discoverable and follows VS Code conventions

Related issue

#269018