Hey, thanks for the report, and especially for the link to the public repo. It makes it easy to reproduce the issue.
This is a known bug in the anysphere.remote-containers extension. It resolves paths in devcontainer.json incorrectly when you switch containers from inside an already running container. Another user reported the same thing here: Switch Container option not working after reinstall (WSL + Dev Containers).
I also noticed something in your logs. The second path is missing a slash: /home/userProjects/... instead of /home/user/Projects/..., which might point to a path resolution issue.
The team is aware. There is no ETA yet, but your report, with a clean repo to reproduce, will help with prioritization.