It appears that VS Studio for Education cannot connect to a board using webserial. The Terminal is for local Python input and output. We want to see the CircuitPython REPL and program output.

This isn't a problem as it only takes another browser window.

There are several online-based serial terminals for web browsers available. This page will show you a lightweight one that passes control characters (which is needed for Control-C to interrupt running code and Control-D for restarting a program.

You can use any web terminal you like if the one presented is not to your liking.

web-serial-terminal in your computer's web browser

web-serial-terminal is a simple terminal program which runs in Google Chrome or MS Edge (Firefox isn't supported due to use of webserial). The source code is even available on GitHub if needed to run offline or to look at the code.

Connect your CircuitPython board to your computer's with a known good data+power USB cable.

Go to https://bipes.net.br/aroca/web-serial-terminal/ in your computer web browser and press the Connect button. The baud rate really doesn't matter with webserial.

A dialog box will pop up asking what port you want to connect to (Note: the dialog box may look different from above depending on your browser and operating system). Select the CircuitPython CDC control port.

You are now connected. You can see I reset my board with the onboard button and via Control C. I restarted the program with Control D and it printed "NeoPixel" noting that it had found an onboard NeoPixel.