This is the way.

I think it doesn't work over tcp but try with the other GUI library.

There is inherent limitation of latency/responsiveness in the tramp model versus the copy vscode server to my server and communicate with it model.

The tramp model does have the advantage of little to no resource usage, but these days most aren't concerned about that.

A lot of times with emacs you can disable the modeline and get performance improvements because frequent updates happen and arent cached.

Well behaved mode line items typically update a variable periodically so blocking never happens.

This won't work for things that use a docker container without wrapper scripts, but those have their own problems.