This is sounds like exactly what I do. My team uses Windows on the desktop, and we develop a containerised Linux app.
We use VSCode dev containers. They are an excellent solution for the scenario.
You may also be able to SSH to your docker host and code on it, but in my view this is less good because you want to keep all customisation "contained" - I have installed a few quality-of-life packages in my dev container which I'd prefer to keep out of my colleague's environments and off the docker host.
We have access to the docker host, so we clone our source on the docker host and mount it through. We also bind-mount folders from the docker host for SQL and Redis data - but that could be achieved with docker volumes instead. IIUC, the workspace folder itself does have to be a bind-mount - in fact, no alternative is allowed in the devcontainer.json file. But since you need permission anyway on the docker daemon, this is probably achievable.
All source code operations happen in the dev container, i.e. in Linux. We commit and push from there, we edit our code there. If we need to work on the repo on our laptops, we pull it locally. No rcopy, no SCP - github is our "sync" mechanism. We previously used vagrant and mounted the source from Windows - the symlinks were an absolute pain for us, but probably anyone who's tried mounting source code from Windows into Linux will have experienced pain over some element or other.
VSCode in a dev container is very similar to the local experience. You will get bash in the terminal. To be real, you probably can't work like this without touching bash. However, you can install PSv7 in the container, and/or a 'better' shell (opinion mine) such as zsh.