Hi! What I did when I had this problem is made sure I downloaded the entire LF repository (So one giant folder that has everything in it) which you can just download from the Foundations Textbook Github. That already has the make file and everything like that inside of it. So after downloading it, I just opened up Basics in Coq, when to the “Compile” header next to tools at the very top, did compile buffer. It should make the files that you need to import it from then on.
I think the problem is with the "coqtop.coqProjectRoot" setting - according to the documentation, it is relative to the workspace root, which I think is the dev-notes directory (the top-level you have open in VSCode), so try setting it to "coq" (the directory that contains the .v and _CoqProject files).
Your _CoqProject needs to list Basics.v and maybe other files. Probably the *.v didn’t match Basics.v because it looked in the wrong directory.
You also need to run make after running coq_makefile so there is a Basics.vo file in the directory containing Basics.v…
Are you using VSCoq extension in VSCode?
I tried to run Induction.v from the entire LF repo with VSCoq, but ran into the same error Cannot find a physical path bound to logical path Basics with prefix lf.