I was just in a user study with @stevencl and I think we have a problem that IDE users have a concept of workspace which is not the VS Code Workspace.

So what happens -> users click Open Workspace and actually want to open the whole folder, however they can not since you expect a .code-workspace file.

Due to that I suggest (if technically possible) that the Open Workspace button allows to open .code-workspace file but also any folder.

This is especially confusing on mac, since the Open.. button opens everything including folders, so users go for Open Workspace and end up being puzzled.