nrf91 failed to create application

Select Application template....

nrf91 failed to create application

Select Application template....

Hello,
Have you tried ticking of the "freestanding" option under "application type" instead of "workspace"?
I have never used workspace before, but seeing as you are trying to select the hello_world sample, perhaps this was just a mistake?
In case you are not aware, we have a webinar that explains the basics of nRF Connect for Visual Studio Code.
Best regards,
Edvin