Commit: db40434f562994116e5b21c24015a2e40b2504e6
Date: 2020-08-11T23:21:50.282Z
Electron: 7.3.2
Chrome: 78.0.3904.130
Node.js: 12.8.1
V8: 7.8.279.23-electron.0
Steps to Reproduce:

I'm not sure if it's relevant, but I had VS stable installed prior to the Insiders install. Also, I tried to remove stable and reinstall Insiders, which resulted in the same error. It seems like everything is functioning properly, but there's no shortcut on the desktop.
Does this issue occur when all extensions are disabled?: Yes
Windows 8.1 64
Same is happening with me, but with the stable installer (VSCodeUserSetup-x64-1.48.0.exe).
I tried to uninstall and install again, but checked only the PATH option. All other options was left unchecked. No error happend. I don't know if was coincidence or that others checked options were causing the error.
I believe "Create desktop shortcut" option may be producing this error.
Same happened installing Visual Studio Code. The thing is it happened with a pretty old Windows (not that that old but quite) but it still let me download it. What does this mean then? I had no problem installing it in another more modern computer but I have no idea what is wrong here...
I also encountered the same problem
Win10 2004 (19041.388)
me too

Same exact error, though I installed it on another PC in my network without issue- same version of Windows, same options checked.
Same exact error, also happened during creation of the shortcut.
Having the same issue. Been using it for over an year but never faced any issue like this. It got updated yesterday when I was working and after that when I tried to use live server, the chrome tab keeps on loading and CPU usage gets above 90% for chrome. Strange.
Up till now, I have tried re-installation (thats when "ipersistfile save failed code 0x80070005" error occured), installing previous version, window update. Nothing seems to work and I think live server issue is happening because of it.
Any idea?
Update: So I tried a suggestion to leave the icon option on desktop unchecked and the error did not occur this time. Somethings wrong with my PC or its a bug? Also, live server issue remains same. Can someone check if they are facing the same issue?
create dekstop shortcut made this error ??
I have the same issue on Windows 7 - and seems like the checked "install link on the desktop" causes the problem, as at the end of installation VS saying "installed fine" and it's running OK.
Users seeing this with vscode insiders when did this start happening?
Users seeing this with vscode stable, do you also see it when you install vscode insiders? https://code.visualstudio.com/insiders/
@bpasero for potential smartness
@deepak1556 even though it is not an electron crash might have some ideas since it looks like a native crash
Running with VSCodeUserSetup-x64-1.48.0.exe /LOG="D:\setup.log"
2020-08-18 10:50:23.263 -- Icon entry --
2020-08-18 10:50:23.263 Dest filename: C:\Users\Public\Desktop\Visual Studio Code.lnk
2020-08-18 10:50:23.264 Creating the icon.
2020-08-18 10:50:23.923 Exception message:
2020-08-18 10:50:23.923 Message box (OK):
IPersistFile::Save failed; code 0x80070005.
Access is denied.
in my case it is a permission issue to the folder it is trying to write the shortcut link to. Users having similar error code please check if the setup executable under your current user has permissions to write into that folder.
If anyone else has a different error code, please paste the inno setup log using /LOG switch as above.
Same issue when installing VSCodeUserSetup-x64-1.48.0.exe stable. After clicking 'OK' everything else appeared to install correctly.

I saw this error as well when I tested the installer (using a Windows VM on Parallels 10).
Same Issue with me today, as @Maxim-Mazurok suggested I install it again without "Creating desktop shortcut" worked and install without any errors.
Sorry about the early conclusion, a bit more investigation looking at the logs of 1.47.3 installation, it does install the shortcut link under the desktop for current user rather than public folder. So this behavior change with 1.48 is indeed a bug.
Looking at the changelog, the only relevant changes that went into the setup code path are https://github.com/microsoft/vscode/commit/5f5b75a746c8f4e2a7e583bb17a2a493dd04e4a6 https://github.com/microsoft/vscode/commit/cbc8bd84ae67ba8b2f6dbc1cf582560a6e1f15ce , will check if the change in setup style brought in this behavior.
@deepak1556 thanks for looking into this. I have cycles so let me know if I can help somehow.
Dear users that see this can you please try to install this insiders build and let us know if you can still reproduce. This would be very valuable to us as it contains a potential fix for this issue:
As far as I understand the issue this only happnes for the user install. If somebody sees this issue for a non user install please let us know.
Dear users that see this can you please try to install this insiders build and let us know if you can still reproduce.
Tried to install your x64 version over my existing installation, same error:

@Maxim-Mazurok thanks a lot. We figured out that it did not fix the issue.
We have another candidate that is being built now, soon it will be out and I will share the links so you can try again.
Really appreicate the help.
Here's win32 build:
Soon we will have win64
So please try it out and let us know.
What is not 100% clear to me are repro steps. It only happens with the user install that creates a desktop shortcut.
@deepak1556 did I get the steps correctly? Just wondering since there are not that many users that complain...
Edit: yeah now the steps are 100% clear to me.
User install + check off create a desktop shorcut -> repros always.
However the VS Code still gets installed, just the desktop shortuct does not get created.
I have verified that the Inno-updater revert of version indeed fixes the issue.
Win64 build: https://az764295.vo.msecnd.net/insider/d514f5cbfc789c2f67f583ec20dc129ee7756546/VSCodeUserSetup-x64-1.48.1-insider.exe
So please try it out and let us know.
Worked for me without any error now with Check in to create a desktop shortcut.

Great. It also worked for me.
So to recap:
The inno-updated update broke this. We are looking into two options for the recovery build:
1) disable the create shortcut button for this release
2) fix the actual issue captured by https://github.com/microsoft/vscode/issues/104981
We will decide on which one to do depending on the risk.
We will not revert back to the old inno-update version due to other chagnes that have gone in.
fyi @lszomoru @deepak1556
It only happens with the user install that creates a desktop shortcut.
Correct, I did check "Create desktop shortcut"
Worked for me without any errors, created shortcut. Thanks!
Thanks @Maxim-Mazurok! We have a PR with a fix that will be included in the recovery build.
All with all options checked:
VSCodeUserSetup-x64-1.48.0.exe >> error
VSCodeUserSetup-x64-1.48.0.exe >> run as admin >> "you should use system" popup >> no error
VSCodeSystemSetup-x64-1.48.0.exe >> no error
VSCodeUserSetup-x64-1.48.1-insider.exe >> no error
Verification steps:
Setup should complete successfully, and a desktop icon should be created
Most helpful comment
@Maxim-Mazurok thanks a lot. We figured out that it did not fix the issue.
We have another candidate that is being built now, soon it will be out and I will share the links so you can try again.
Really appreicate the help.