When I moved to this OS, I was trying this as well. I remember that i had installed Python from the official site which is python.org, but I did not face this issue.
I suggest you update the python version on your system, ensure you installed the suitable version, and retry connecting to the virtual env via VS code. I suggest to follow the tip that was shared earlier in the following link, to reinstall, or update the Jupyter extension, and then relaunch your VS code software.
Also some quick checklist:
ensure ipykernel is installed in your system (if not, install it)
you can try registering the env by yourself on the kernel.
ensure kernel is selected correctly inside your VS code app.
if all above 3 points are satisfied, close the app and restart VS code.
Would love to hear if there's any more effective way to combat this. In addition to above, you can read the attached official documentation of VS code, with link to py environments section.