Never liked Eclipse, but I’ve been forced to use VSCode over my preferred JetBrains IDEs because it is the only modern mainstream editor with a competent client-server mode. As in, actually rendering the UI locally while doing all the code indexing and intelligence on the server. Corporate world would much rather maintain disposable remote VMs than help you unfuck your laptop after whatever required security upgrade installs the wrong version of a scripting language and sends everything to hell.
It’s not as dumb a client as VNC, but it’s close. Basic operations like typing and scrolling will stutter and lag if your connection is less than perfect. VSCode’s client is really VSCode from a UI perspective.
They're not using the remote VM as a server but as the development machine though. You don't want to have to git commit and push every time you need to run or even type-check your code.
I think what GP describes is actually a pretty okay solution for orgs that don't want to provider their devs with local admin privileges.
You can develop locally if you want to, and lots of people do, but it’s community support. The environment that someone else is obligated to fix for you is the remote one (which they can do by blowing away the container and then you recover your state from Git).