There is a tiny icon on macOS dock that is not clickable!
Edit As pointed by many others (@nitive's comment below) there is a much easier way to fix this and it is killall Dock. Kudos to @nitive



Original long, boring, and not so efficient answer

LOL right after posting it, I found the answer

Fist: open the Dock config (plist):

open ~/Library/Preferences/com.apple.Dock.plist


Second: Find the item in persistent-apps:


Third: Delete the item! In this case, "Item 14"

Forth: Save the file

Fifth: kill the Dock to force it to restart

Honestly, I was expecting it not to have the VS Code icon anymore but magically the icon reappeared there with the right size!