Parsing errors with minimal setup

[bo3b]

1. I set up a completely fresh VSCode, by deleting my user/.vscode and appdata/Code directories.
2. I installed, solely the FreePascal Toolkit from marketplace. v1.2.7
3. I set minimal Settings:
   a. FPCDir: C:\lazarus\fpc\3.2.2
   b. FPCTarget: win32
   c. FPCTargetCPU: i386
   d. Fpctoolkit.lsp.Trace: verbose
4. Made a new folder as starting location.
5. In FPC PROJECTS lower left, I choose + to create new project.
6. Chose Program With Unit template.
7. In lower left I choose Build Debug. Compiles without errors.

With this starting template, I'm still getting errors that look like parsing errors.

In this example snapshot you can see the error of Identifier Not Found: Enter. Which is part of a the string 'Press Enter to exit...'

I get a lot of different errors of this form, this is just the simplest example. It also misparses the SysUtils and windows units. An example out of SysUtils:

C:\lazarus\fpc\3.2.2\source\rtl\win\sysutils.pp: "identifier not found: HAS_LOCALTIMEZONEOFFSET" @ 19:10;

I think maybe this happens on hover, but am not sure. When I hold Ctrl, I get these all the time. When I F12, it doesn't seem to happen.

Wait, I just figured out the bug: When I hold Ctrl down, then mouse over a given word, it brings up the errors. The hover can pull words out of context like 'Welcome', or 'advancedrecords' and throw an error.

It only seems to happen inside comments and strings. Other live, actual code hover is OK.

[bo3b]

1.1.9 works OK.
1.2.0 works OK.
1.2.1 works OK.
1.2.3 ePipe errors
1.2.4 ePipe errors
1.2.5 ePipe errors
1.2.6 fails
1.2.7 fails