So a program that is specifically designed to edit files and run arbitrary commands on a remote machine... can do so. Not sure where the bananas part comes in. Sending a binary over SSH/SFTP might sound weird at first glance, but VSCode can't assume that your remote machine can access the wider internet, and it needs a reliable way to bootstrap the agent on the remote. Shipping it over the SSH tunnel is the natural solution.
Yeah, I learned how it worked when I made the mistake of trying to use it to develop on a Raspberry Pi, where it filled the disk and crashed/hung the Pi by using all the RAM until it started using swap. Fell back to local with an sshfs mount instead.
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