fix(jetbrains): gate reflow settle window on Busy, not isBusy()

isBusy() is true for awaiting-permission/question, retry, and offline —
states recoverPending() can seed right after history load, where no deltas
arrive and a moving height genuinely means the panes are still settling.
Gating the settle-window shortcut on those states cut the reflow chain to
REFLOW_PASSES and reintroduced the crop-until-resize bug on exactly that
path. Gate only on SessionState.Busy (the streaming state) so the runaway
fix stays while blocked/retry/offline sessions keep their full settle window.
Add a Busy-state test that fails if the term is dropped or inverted.

packages/kilo-jetbrains/frontend/src/main/kotlin/ai/kilocode/client/session/ui/SessionMessageListPanel.kt

@@ -553,12 +553,14 @@ class SessionMessageListPanel(
             return
         }
         val height = preferredSize.height
-        // A moving height means the layout is still settling only while the session is idle. During
-        // streaming it just tracks incoming content, so restarting the settle window on every delta
-        // was the runaway that pinned the panel in a perpetual forgetAll()/re-measure loop. Count the
-        // pass down while busy so streaming settles in REFLOW_PASSES and hands off to the per-turn
-        // forgetTurn path; [budget] still caps the idle case if a pane never converges.
-        val left = if (height == stable || model.state.isBusy()) remaining - 1 else REFLOW_PASSES
+        // A moving height only means the layout is still settling when nothing is streaming in. While
+        // [SessionState.Busy] deltas land every EDT cycle, so restarting the settle window on each one
+        // was the runaway that pinned the panel in a perpetual forgetAll()/re-measure loop — count the
+        // pass down instead so streaming settles in REFLOW_PASSES and hands off to the per-turn
+        // forgetTurn path. Every other state (idle, awaiting-permission/question, retry, offline —
+        // which recoverPending() can seed right after load) has no deltas arriving, so a moving height
+        // is genuine convergence and must keep restarting; [budget] caps that if a pane never settles.
+        val left = if (height == stable || model.state is SessionState.Busy) remaining - 1 else REFLOW_PASSES
         stable = height
         ApplicationManager.getApplication().invokeLater {
             reflowPass(id, left, budget - 1)

packages/kilo-jetbrains/frontend/src/test/kotlin/ai/kilocode/client/session/ui/SessionMessageListPanelTest.kt

@@ -221,6 +221,26 @@ class SessionMessageListPanelTest : BasePlatformTestCase() {
         assertTrue("reflow passes must be bounded by the budget, was $reflows", reflows in 1..30)
     }
 
+    fun `test streaming session settles reflow within the pass window`() {
+        var reflows = 0
+        panel.onReflow = { reflows++ }
+        // Same ever-growing child, but a streaming (Busy) session: a moving height is incoming
+        // content, not the layout still settling, so the chain must count its passes down and stop
+        // after REFLOW_PASSES instead of restarting the settle window and draining the full budget
+        // the idle case relies on. recoverPending()'s non-Busy states (awaiting-permission, retry,
+        // offline) intentionally keep the idle settle behavior and are not gated here.
+        model.loadHistory(listOf(MessageWithPartsDto(msg("u1", "user"), emptyList())))
+        model.setState(SessionState.Busy("thinking"))
+        panel.add(EverGrowing(), 0)
+        panel.setSize(600, 400)
+
+        UIUtil.dispatchAllInvocationEvents()
+
+        // A handful of passes (~REFLOW_PASSES), well short of the idle budget (~25). Dropping or
+        // inverting the Busy term restarts the window every pass and blows past this bound.
+        assertTrue("streaming reflow must settle in the pass window, was $reflows", reflows in 1..10)
+    }
+
     fun `test apply style drops cached panel measurements`() {
         val child = Growing(20)
         panel.add(child, 0)