Respect VIRTUAL_ENV_PROMPT when calculating PS1 (#23080)

Closes #22956

Because we calculate `PS1` ourselves due to a limitation:
#22078, this environment
variable may not end up being respected as do not use `PS1`. This PR
fixes it.

src/client/terminals/envCollectionActivation/service.ts

@@ -338,6 +338,8 @@ export class TerminalEnvVarCollectionService implements IExtensionActivationServ
     }
 
     private async getPS1(shell: string, resource: Resource, env: EnvironmentVariables) {
+        // PS1 returned by shell is not predictable: #22078
+        // Hence calculate it ourselves where possible. Should no longer be needed once #22128 is available.
         const customShellType = identifyShellFromShellPath(shell);
         if (this.noPromptVariableShells.includes(customShellType)) {
             return env.PS1;
@@ -347,7 +349,7 @@ export class TerminalEnvVarCollectionService implements IExtensionActivationServ
             const interpreter = await this.interpreterService.getActiveInterpreter(resource);
             const shouldSetPS1 = shouldPS1BeSet(interpreter?.type, env);
             if (shouldSetPS1) {
-                const prompt = getPromptForEnv(interpreter);
+                const prompt = getPromptForEnv(interpreter, env);
                 if (prompt) {
                     return prompt;
                 }
@@ -456,7 +458,7 @@ function shouldSkip(env: string) {
     ].includes(env);
 }
 
-function getPromptForEnv(interpreter: PythonEnvironment | undefined) {
+function getPromptForEnv(interpreter: PythonEnvironment | undefined, env: EnvironmentVariables) {
     if (!interpreter) {
         return undefined;
     }
@@ -465,6 +467,9 @@ function getPromptForEnv(interpreter: PythonEnvironment | undefined) {
             // If conda base environment is selected, it can lead to "(base)" appearing twice if we return the env name.
             return undefined;
         }
+        if (interpreter.type === PythonEnvType.Virtual && env.VIRTUAL_ENV_PROMPT) {
+            return `(${env.VIRTUAL_ENV_PROMPT}) `;
+        }
         return `(${interpreter.envName}) `;
     }
     if (interpreter.envPath) {