Does TestItems work in julia 1.12 using new package workspace feature

Tooling VS Code
1

I just switched one of my packages to use the new workspace system, where the test directory has its own Project.toml.

Tests run correctly from the REPL but when I try to use the VSCode testing framework none of the tests run. Instead I get this error message:

[ Info: Julia test item process launching
  Activating project at `c:\Users\seatt\source\OpticSim.jl`
ERROR: MethodError: no method matching prune_manifest(::Pkg.Types.Manifest, ::Vector{Base.UUID})
The function `prune_manifest` exists, but no method is defined for this combination of argument types.

Closest candidates are:
  prune_manifest(::Pkg.Types.Manifest, !Matched::Set{Base.UUID})
   @ Pkg C:\Users\seatt\.julia\juliaup\julia-1.12.1+0.x64.w64.mingw32\share\julia\stdlib\v1.12\Pkg\src\Operations.jl:1214
  prune_manifest(!Matched::Pkg.Types.EnvCache)
   @ Pkg C:\Users\seatt\.julia\juliaup\julia-1.12.1+0.x64.w64.mingw32\share\julia\stdlib\v1.12\Pkg\src\Operations.jl:1193

Stacktrace:
 [1] activate(pkg::String; allow_reresolve::Bool)
   @ TestItemServer.TestEnv c:\Users\seatt\.vscode\extensions\julialang.language-julia-1.149.2\scripts\packages\TestItemControllers\packages\TestEnv\src\julia-1.11\activate_set.jl:40
 [2] activate
   @ c:\Users\seatt\.vscode\extensions\julialang.language-julia-1.149.2\scripts\packages\TestItemControllers\packages\TestEnv\src\julia-1.11\activate_set.jl:9 [inlined]
 [3] activate_env_request(params::TestItemServer.TestItemServerProtocol.ActivateEnvParams, state::TestItemServer.TestProcessState{var"#2#3"}, token::TestItemServer.CancellationTokens.CancellationToken)
   @ TestItemServer c:\Users\seatt\.vscode\extensions\julialang.language-julia-1.149.2\scripts\packages\TestItemControllers\testprocess\TestItemServer\src\TestItemServer.jl:551
 [4] dispatch_msg(x::TestItemServer.JSONRPC.JSONRPCEndpoint{Base.PipeEndpoint, Base.PipeEndpoint}, msg::TestItemServer.JSONRPC.Request, context::TestItemServer.TestProcessState{var"#2#3"})
   @ TestItemServer c:\Users\seatt\.vscode\extensions\julialang.language-julia-1.149.2\scripts\packages\TestItemControllers\packages\JSONRPC\src\typed.jl:114
 [5] (::TestItemServer.var"#serve##2#serve##3"{TestItemServer.TestProcessState{var"#2#3"}, TestItemServer.JSONRPC.JSONRPCEndpoint{Base.PipeEndpoint, Base.PipeEndpoint}, TestItemServer.JSONRPC.Request})()
   @ TestItemServer c:\Users\seatt\.vscode\extensions\julialang.language-julia-1.149.2\scripts\packages\TestItemControllers\testprocess\TestItemServer\src\TestItemServer.jl:710

Does the VSCode test framework not work in 1.12 with workspaces?