I have downloaded the Ubuntu image inside Docker on Windows.
I can run Ubuntu by:
docker run -it ubuntu
I only see root
Generally, the approach for developing with Docker is to keep the IDE on the workstation, and build images with the binary produced from the sources.
You can find many example of such a workflow (local compilation, deployment in Docker containers) in domeide.github.io/ (Docker meets the IDE!)
For example: Docker Tools for VisualStudio allows for a tight integration between your editor and Docker processes.
(But this is for Visual Studio 2015, not Visual Studio Code.)