I set vscode as my git editor using git config --global core.editor "code --wait", this works fine for the commit flow but not for the interactive rebase flow where vscode just can't manage to open the git-rebase-todo file.
I went into the folder where the file exists and tried to open from there using code git-rebase-todo but that didn't work either ( same error ). But other editors could open it and using "cat" on the file confirmed it's there and has the right content to be displayed.
EDIT: I can't find the original post I read about this but it started working for me overnight, the author of the original post had the exact same thing happen, maybe vscode needs to restart for the rebase to work or maybe a computer restart needs to happen.