You could try look in the Tinymist output (in the command palette: Output: Show Output Channels… – TinyMist Typst). Easiest to check is directly after restarting VS Code and opening a Typst file, you should see something like
[2025-08-30T15:19:30Z INFO tinymist::config] ServerState: config update_by_map
{"colorTheme":"dark","compileStatus":"enable",...,"typstExtraArgs":["--features","html"]}
(linebreak added by me)
From quickly trying stuff out, it seems that using “Typst: Restart server” was not sufficient to make it recognize changes in that option, so maybe that really was the problem.