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Dedicated user account does not work as eventually all your code and data will move under that.

I run it in an ephemeral container sandbox (https://github.com/ashishb/amazing-sandbox) which has access to the current working directory and it drastically limits the attack radius.

If all the code and data eventually move into the dedicated user account, why wouldn't it also eventually move into the container/vm?
Don't mount all your code every time.

E.g. when working on a frontend only project, you don't need to mount the backend directory and vice-versa. This limits the attack radius.

I’m fine with that. I use a top-level directory for all of my code, and restricting extension access to that directory is a great idea.
It is good but you still don't want long running background tasks.

When you run a linter, for example, then it should stop executing cider once it stops. And not be able to spawn long-running background tasks for infiltration.

That looks really nice, including the VSCode/Mac wrapper.