fix(patch): cherry-pick 4d4e16c to release/v0.27.0-preview.0-pr-17785 to patch version v0.27.0-preview.0 and create version 0.27.0-preview.1 (#17823)

Co-authored-by: christine betts <chrstn@uw.edu>

packages/cli/src/config/extension-manager-hydration.test.ts

@@ -306,6 +306,7 @@ System using model: \${MODEL_NAME}
       'MY_VALUE',
       mockRequestSetting,
       ExtensionSettingScope.USER,
+      process.cwd(),
     );
 
     await extensionManager.restartExtension(extension);

packages/cli/src/config/extensions/extensionSettings.ts

@@ -207,7 +207,7 @@ export async function updateSetting(
   settingKey: string,
   requestSetting: (setting: ExtensionSetting) => Promise<string>,
   scope: ExtensionSettingScope,
-  workspaceDir?: string,
+  workspaceDir: string,
 ): Promise<void> {
   const { name: extensionName, settings } = extensionConfig;
   if (!settings || settings.length === 0) {