Agreed, I kind of wish that MS could come up with a way to get rebase/squash and pull --rebase working in the editor, having a 3-way merge in VS Code would be awesome... unfortunately it doesn't work well as a system editor choice for git cli.
Been very happy with VS Code, though I wish I could revert to pre-tabs file behavior, I'd like the space back... it took getting used to, but the list switcher was a better UX imho.