When VS Code created the mcp.json file, it was created as a user config file on the Windows side by default: /C:/Users/spencer/AppData/Roaming/Code/User/mcp.json
/C:/Users/spencer/AppData/Roaming/Code/User/mcp.json
The file needs to be in your workspace: /{path to project}/.vscode/mcp.json
/{path to project}/.vscode/mcp.json