VSCode new project intellisense errors

I am using the nrfConnect plugin for vscode, I used it to install the SDK and create a new project. I am using the Bluetooth Mesh Light (srv) as a template.

The build is successful and the device flashes fine all through the VSCode interface, but the intellisense is broken and I can't see the dependent files (see image below).
Error states: cannot open source file "bluetooth/mesh/models.h"C/C++(1696)


Any ideas why? Thanks for any guidance!

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