Context is the bottleneck for coding agents now

There's a misunderstanding here broadly. Context could be infinite, but the real bottleneck is understanding intent late in a multi-step operation. A human can effectively discard or disregard prior information as the narrow window of focus moves to a new task, LLMs seem incredibly bad at this.

Having more context, but leaving open an inability to effectively focus on the latest task is the real problem.

This is a great insight. Any thoughts on how to address this problem?

For me? It's simple. Completely empty the context and rebuild focused on the new task at hand. It's painful, but very effective.