Open Link in VSCode Will Create a New Web Browser Under Same Icon as VSCode

Try making firefox your default browser thorugh firefox and also do check that firefox is your default browser from vscode

There is already an issue on VSCode's GitHub repository and as it is mentioned in the issue, origin of the issue is in snapd.

To fix the issue, as mentioned on aforementioned github issue:

1. Open some URL from the VSCode snap.
2. In the new window, navigate to about:profiles.
3. Ensure that the profile marked as "Default Profile" matches Firefox when opened normally. If not, use the "Set as default profile" button under the correct profile to change the default.