Before
[22:07:35.461] SSH Resolver called for "ssh-remote+vm+demo@ssh.local", attempt 1
[22:07:35.502] SSH Resolver called for host: vm
[22:07:35.539] Running script with connection command: ssh -T -D 39023 -o ConnectTimeout=15 -F '<isolated SSH config>' vm bash
[22:07:35.825] > ssh: Could not resolve hostname vm: Name or service not known

After
[22:11:38.000] SSH Resolver called for "ssh-remote+7b22686f73744e616d65223a227373682e6c6f63616c222c2275736572223a22766d2b64656d6f227d", attempt 1
[22:11:38.050] SSH Resolver called for host: vm+demo@ssh.local
[22:11:38.077] Running script with connection command: ssh -T -D 35565 -F '<isolated SSH config>' 'vm+demo@ssh.local' bash
[22:11:45.442] Remote server is listening on port 33115

Remote terminal on head:
$ whoami; hostname; pwd
vm+demo
ssh.example.com
/mnt/workspace/project

SSH server on head: Accepted publickey for vm+demo (ephemeral key fingerprint omitted).