ListenOnSocket": false
[15:49:16.849] "remote.SSH.showLoginTerminal": false
[15:49:16.849] "remote.SSH.defaultExtensions": []
[15:49:16.849] "remote.SSH.loglevel": 2
[15:49:16.849] "remote.SSH.serverPickPortsFromRange": {}
[15:49:16.849] "remote.SSH.enableDynamicForwarding": true
[15:49:16.849] "remote.SSH.serverInstallPath": {}
[15:49:16.850] SSH Resolver called for host: ec2-user
[15:49:16.850] Setting up SSH remote "ec2-user"
[15:49:16.886] Using commit id "899d46d82c4c95423fb7e10e68eba52050e30ba3" and quality "stable" for server
[15:49:16.890] Install and start server if needed
[15:49:19.539] Checking ssh with "ssh -V"
[15:49:19.607] > OpenSSH_for_Windows_8.6p1, LibreSSL 3.3.3

[15:49:19.614] Using SSH config file "C:\Users\algoo\.ssh\config\"
[15:49:19.614] Running script with connection command: ssh -T -D 59628 -F "C:\Users\algoo\.ssh\config\" "ec2-user" bash
[15:49:19.617] Terminal shell path: C:\WINDOWS\System32\cmd.exe
[15:49:19.860] > u]0;C:\WINDOWS\System32\cmd.exe
[15:49:19.861] Got some output, clearing connection timeout
[15:49:19.874] > sage: ssh [-46AaCfGgKkMNnqsTtVvXxYy] [-B bind_interface]
>            [-b bind_address] [-c cipher_spec] [-D [bind_address:]port]
>            [-E log_file] [-e escape_char] [-F configfile] [-I pkcs11]
>            [-i identity_file] [-J [user@]host[:por
[15:49:19.889] > t]] [-L address]
>            [-l login_name] [-m mac_spec] [-O ctl_cmd] [-o option] [-p port]
>            [-Q query_option] [-R address] [-S ctl_path] [-W host:port]
>            [-w local_tun[:remote_tun]] destination [command]
> The process tried to write to a nonexistent pipe.
[15:49:21.170] "install" terminal command done
[15:49:21.171] Install terminal quit with output:            [-w local_tun[:remote_tun]] destination [command]
[15:49:21.171] Received install output:            [-w local_tun[:remote_tun]] destination [command]
[15:49:21.172] Failed to parse remote port from server output
[15:49:21.173] Resolver error: Error: 
    at Function.Create (c:\Users\algoo\.vscode\extensions\ms-vscode-remote.remote-ssh-0.70.0\out\extension.js:1:430425)
    at Object.t.handleInstallOutput (c:\Users\algoo\.vscode\extensions\ms-vscode-remote.remote-ssh-0.70.0\out\extension.js:1:429068)
    at Object.t.tryInstall (c:\Users\algoo\.vscode\extensions\ms-vscode-remote.remote-ssh-0.70.0\out\extension.js:1:524212)
    at processTicksAndRejections (internal/process/task_queues.js:93:5)
    at async c:\Users\algoo\.vscode\extensions\ms-vscode-remote.remote-ssh-0.70.0\out\extension.js:1:487216
    at async Object.t.withShowDetailsEvent (c:\Users\algoo\.vscode\extensions\ms-vscode-remote.remote-ssh-0.70.0\out\extension.js:1:490561)
    at async Object.t.resolve (c:\Users\algoo\.vscode\extensions\ms-vscode-remote.remote-ssh-0.70.0\out\extension.js:1:488295)
    at async c:\Users\algoo\.vscode\extensions\ms-vscode-remote.remote-ssh-0.70.0\out\extension.js:1:564197
[15:49:21.177] ------




[16:02:54.387] ConfigFileWatcher: start watching file:///c%3A/Users/algoo/.ssh/config/
[16:02:54.387] ConfigFileWatcher: adding save listener
[16:02:54.387] ConfigFileWatcher: adding close listener

is there anything that i missed out?

A: [15:49:16.848] "remote.SSH.path": undefined

^^^ Try setting the remote.SSH.path in settings.json and see if that works. I use the one that comes with Git Bash
These are my settings by the way:
  "remote.SSH.enableDynamicForwarding": false,
  "remote.SSH.lockfilesInTmp": true,
  "remote.SSH.path": "%ProgramFiles/Git/usr/bin/ssh.exe",
  "remote.SSH.useLocalServer": true,

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