Thanks for try it @Christian , so, should be there a workaround. Let’s try another way.
1- Create a folder with the name .torizon at:
C:\Users\Public
2- Create a file called password.txt at:
C:\Users\Public\.torizon
3- Into the file add the following content:
newUser:newPassword
Here you can set the preferred name and password for your new distro login.
4- Close VS Code (if not closed yet) and then start the extension installation process again
This is a mechanism that exists to automate tests. Please try and report if this works.
EDIT: and please do not forget to remove the password.txt file as soon as the distro configures the new user.
BR,