SSH: This extension is enabled in the Remote Extension Host because it prefers to run there.

[justanotheranonymoususer]

I like your extension, thanks for creating it.

I connected to an SSH server, and it stopped working, I had to install it on the SSH server. Now I see the following message:
This extension is enabled in the Remote Extension Host because it prefers to run there. Learn more

It works, but it's a bit sluggish, looks like the duplication goes though the server.

Is there a way to make the extension work locally, like regular editing works?

[justanotheranonymoususer]

Never mind, looks like this functionality is now built in:
microsoft/vscode#2075 (comment)

The extension predates it, so thanks for filling the gap before it was officially available.