Watch subdirectories in project root instead of watching project root so as to avoid watching excluded directories that are not part of config file

Fixes #25629 and microsoft/vscode#51139

Author: sheetalkamat

src/compiler/resolutionCache.ts

@@ -398,8 +398,17 @@ namespace ts {
 
         function getDirectoryToWatchFailedLookupLocation(failedLookupLocation: string, failedLookupLocationPath: Path): DirectoryOfFailedLookupWatch {
             if (isInDirectoryPath(rootPath, failedLookupLocationPath)) {
-                // Always watch root directory recursively
-                return { dir: rootDir!, dirPath: rootPath }; // TODO: GH#18217
+                failedLookupLocation = isRootedDiskPath(failedLookupLocation) ? failedLookupLocation : getNormalizedAbsolutePath(failedLookupLocation, getCurrentDirectory());
+                Debug.assert(failedLookupLocation.length === failedLookupLocationPath.length, `FailedLookup: ${failedLookupLocation} failedLookupLocationPath: ${failedLookupLocationPath}`); // tslint:disable-line
+                const subDirectoryInRoot = failedLookupLocationPath.indexOf(directorySeparator, rootPath.length + 1);
+                if (subDirectoryInRoot !== -1) {
+                    // Instead of watching root, watch directory in root to avoid watching excluded directories not needed for module resolution
+                    return { dir: failedLookupLocation.substr(0, subDirectoryInRoot), dirPath: failedLookupLocationPath.substr(0, subDirectoryInRoot) as Path };
+                }
+                else {
+                    // Always watch root directory non recursively
+                    return { dir: rootDir!, dirPath: rootPath, nonRecursive: false }; // TODO: GH#18217
+                }
             }
 
             return getDirectoryToWatchFromFailedLookupLocationDirectory(
@@ -478,6 +487,7 @@ namespace ts {
                         customFailedLookupPaths.set(failedLookupLocationPath, refCount + 1);
                     }
                     if (dirPath === rootPath) {
+                        Debug.assert(!nonRecursive);
                         setAtRoot = true;
                     }
                     else {
@@ -487,8 +497,8 @@ namespace ts {
             }
 
             if (setAtRoot) {
-                // This is always recursive
-                setDirectoryWatcher(rootDir!, rootPath); // TODO: GH#18217
+                // This is always non recursive
+                setDirectoryWatcher(rootDir!, rootPath, /*nonRecursive*/ true); // TODO: GH#18217
             }
         }
 

src/harness/virtualFileSystemWithWatch.ts

@@ -583,6 +583,10 @@ interface Array<T> {}`
                 return;
             }
             this.invokeFileWatcher(fileOrDirectory.fullPath, FileWatcherEventKind.Created);
+            if (isFsFolder(fileOrDirectory)) {
+                this.invokeDirectoryWatcher(fileOrDirectory.fullPath, "");
+                this.invokeWatchedDirectoriesRecursiveCallback(fileOrDirectory.fullPath, "");
+            }
             this.invokeDirectoryWatcher(folder.fullPath, fileOrDirectory.fullPath);
         }
 
@@ -599,12 +603,11 @@ interface Array<T> {}`
             this.invokeFileWatcher(fileOrDirectory.fullPath, FileWatcherEventKind.Deleted);
             if (isFsFolder(fileOrDirectory)) {
                 Debug.assert(fileOrDirectory.entries.length === 0 || isRenaming);
-                const relativePath = this.getRelativePathToDirectory(fileOrDirectory.fullPath, fileOrDirectory.fullPath);
                 // Invoke directory and recursive directory watcher for the folder
                 // Here we arent invoking recursive directory watchers for the base folders
                 // since that is something we would want to do for both file as well as folder we are deleting
-                this.invokeWatchedDirectoriesCallback(fileOrDirectory.fullPath, relativePath);
-                this.invokeWatchedDirectoriesRecursiveCallback(fileOrDirectory.fullPath, relativePath);
+                this.invokeWatchedDirectoriesCallback(fileOrDirectory.fullPath, "");
+                this.invokeWatchedDirectoriesRecursiveCallback(fileOrDirectory.fullPath, "");
             }
 
             if (basePath !== fileOrDirectory.path) {

src/testRunner/unittests/tscWatchMode.ts

@@ -2262,8 +2262,11 @@ declare module "fs" {
             const files = [file, module, libFile];
             const host = createWatchedSystem(files, { currentDirectory });
             const watch = createWatchOfFilesAndCompilerOptions([file.path], host);
+
             checkProgramActualFiles(watch(), [file.path, libFile.path]);
             checkOutputErrorsInitial(host, [getDiagnosticModuleNotFoundOfFile(watch(), file, "qqq")]);
+            checkWatchedDirectories(host, emptyArray, /*recursive*/ false);
+            checkWatchedDirectories(host, [`${currentDirectory}/node_modules`, `${currentDirectory}/node_modules/@types`], /*recursive*/ true);
 
             host.renameFolder(`${currentDirectory}/node_modules2`, `${currentDirectory}/node_modules`);
             host.runQueuedTimeoutCallbacks();
@@ -2622,7 +2625,7 @@ declare module "fs" {
             createWatchOfConfigFile("tsconfig.json", host);
             checkWatchedFilesDetailed(host, [libFile.path, mainFile.path, config.path, linkedPackageIndex.path, linkedPackageOther.path], 1);
             checkWatchedDirectories(host, emptyArray, /*recursive*/ false);
-            checkWatchedDirectoriesDetailed(host, [mainPackageRoot, linkedPackageRoot, `${mainPackageRoot}/node_modules/@types`, `${projectRoot}/node_modules/@types`], 1, /*recursive*/ true);
+            checkWatchedDirectoriesDetailed(host, [`${mainPackageRoot}/@scoped`, `${mainPackageRoot}/node_modules`, linkedPackageRoot, `${mainPackageRoot}/node_modules/@types`, `${projectRoot}/node_modules/@types`], 1, /*recursive*/ true);
         });
     });