When using the "files.associations" settings you suggest in the README, all HTML files are set to "django-html" language by default, which I don't believe is the intended effect. I use the following "files.associations" settings which sets all HTML files to the "html" language mode by default, and then only Django template files as "django-html". Feel free to update your README with these settings suggestions instead, if you'd like.
"files.associations": {
"**/*.html": "html",
"**/templates/**/*.html": "django-html",
"**/templates/**/*": "django-txt",
"**/requirements{/**,*}.{txt,in}": "pip-requirements"
},