"The file is being edited in the background" AI Generated Code Files Not Created

:lady_beetle: Cursor no longer generates code files when prompted. Instead, it details the changes it made, but instead of attaching the code file it says “The file is being edited in the background”
:counterclockwise_arrows_button: Before I started seeing this bug, I had been showing a friend how to generate files on cursor and accidentally “Saved Workspace as”. I then deleted that workspace
:camera:

:laptop: Cursor Version 0.46.11 MacBook Pro Sequoia 15.3.1
:prohibited: This makes it more difficult for me to use Cursor

Update: I am able to get around this by using “Edit” mode. But in Ask mode, code will not be generated

Starting a new file, “Ask” mode is able to generate code snippets (for an HTML file)

Resolved the issue, it was because I had saved and deleted the Workspace file. Saving a new Workspace resolved it for me