First of all, we don't have any VS Code API that allows us to capture command executions at this moment. But, we could imagine that we have an event API for that. Let's name it onDidExecuteCommand.
If we could capture all the command executions, is it possible to reproduce the scenario by simply executing all the captured commands by vscode.commands.executeCommand API?
No, probably.
A command may trigger another command. It happens by directly invoking vscode.commands.executeCommand in a command or in some way indirectly like making side-effects like document change. So we must distinguish them to execute only the commands that are triggered directly by the user.
On the other hand, capturing keystrokes could be a good solution for reproducing recorded scenarios since a keystroke is always made directly by the user. A keystroke does not trigger another keystroke.
However, we don't have any VS Code API to capture keystrokes directly.
We have keybindings. Using that we can associate keystrokes with commands.
However, we can't associate every possible keystroke by defining a single keybinding rule (imagine kind of using wildcard "key": "*").
So we end up defining a bunch of wrapper keybindings to capture the whole set of the default keybindings of VS Code.
On VS Code, typed characters in text editors are treated differently than other keystrokes. We don't put every possible character in the keybindings. When you type characters in a text editor, for each character, the type build-in command is invoked internally. The type command performs inserting each character into the document.
As far as I know, an extension is allowed to override the type built-in command using vscode.commands.registerCommand API. Actually, the VSCodeVim extension seems to do that to customize the behavior for typed characters.
It was not clear whether overriding the type command to capture typed characters is a good way for this extension. Especially if you use this extension combined with another extension that is overriding the type command too, there would be a conflict, and likely they will not work correctly.
So this extension took another way to capture typed characters. That is to listen to the events on changes on the text document. Basically this is possible through the vscode.workspace.onDidChangeTextDocument event.