Verified couple of times - with this change I can revert back changes in createTerminal and still have Git Bash started on VS Code restart.

async createTerminal(options?: ICreateTerminalOptions): Promise<ITerminalInstance> {
-	if (!this._availableProfiles) {
-		await this._refreshAvailableProfilesNow();
-	}
-	const config = options?.config || this._availableProfiles?.find(p => p.profileName === this._defaultProfileName);
+	const config = options?.config;

Will create follow-up PR with this change and related cleanup so it can be verified in Insiders before release, while I think c813199 should be included into Recovery release.

@Tyriar could you please take a look on this PR. It's good candidate for Recovery release as it solves set of issues with Terminal profiles.

Thanks!

@IllusionMH FYI I don't think we can remove that !this._availableProfiles check as it would introduce a low repro race condition; it's used later on in the terminal creation flow.

@Tyriar agree about check and awaiting for . Borrowed some code from my POC that helps to repro race conditions to repro this one again 😄 For some reason it was harder then before.

However I doubt that || this._availableProfiles?.find(...) is needed anymore as it was first change (fixed Create terminal button) to get profiles when there was no options.config.

P.S. Also Thank you and @meganrogge for considering it for Recovery and your patience! ❤️
Sorry for being so annoying with this change

Yep that might not be needed due to resolving happening later on:

Little hesitant to change unless there's an issue though.

Will this resolve #132766 as well?

I believe that it should. You can try latest Insiders build which includes this change and another tuning form Tyriar.