The Remote-SSH extension starts a hidden remote terminal at one point to run some commands. In this issue microsoft/vscode-remote-release#1760 people reported that the terminal was being shown to them, when it should never be shown because it sets a flag to be hidden. We realized that it is shown because this extension runs a command in it, and setting this setting fixes it:

"python.terminal.activateEnvironment": false

It sounds like the Python extension should be able to know that these terminals are not terminals in the user's workspace, and should not touch them: microsoft/vscode-remote-release#1760 (comment)