Projects handoff to remote workers is super slow because of misleading file paths

Where does the bug appear (feature/product)?

Cursor IDE

Describe the Bug

Everytime a project chat starts a worker on my local machine (for local MCPs like Paper that can’t run in a remote env for example) it gives the subagent a very misleading file path like this one:

Read first: /cursor/stores/bc-dabc1f16-d4a0-4f0c-baa6-da62732a6033/docs/checkout-reference-board.md

The worker will try to access this directly and obviously fails and then spins a find command on my whole home folder to try to find the file and that usually takes around 10min to complete. Which means I have a 10min cost to start any local work with projects which renders that feature very frustrating to use. Surely there’s a better way to handle this.

Steps to Reproduce

  1. Setup a project with a context that will be needed for a local agent
  2. Start a task that requires a local agent
  3. The local agent will eventually run a find command to find the handoff files

Expected Behavior

I’d expect no additional latency from working on local chats with projects. The file should be handed off with local paths or a easier way for the agent to know where they reside such as a local skill or additional context in the system prompt.

Operating System

MacOS

Version Information

Version: 3.20.17
VS Code Extension API: 1.128.0
Commit: 0c32194e3fb5ffaced9fb36430b860ec301e1fc0
Date: 2026-09-12T03:16:10.634Z
Layout: Agent Window
Build Type: Stable
Release Track: Default
Electron: 42.10.0
Chromium: 148.0.7778.280
Node.js: 24.18.1
V8: 14.8.178.38-electron.0
xterm.js: 6.1.0-beta.291
OS: Darwin arm64 25.5.0

For AI issues: which model did you use?

Grok 4.6 Extra High

Does this stop you from using Cursor

Sometimes - I can sometimes use Cursor