Yes, the new way of mapping local resources doesn't work at all. Bring back the old way. It might have been a manual process, but at least it worked.

@lushnikov: Could you please confirm whether this issue is similar to that of 796368, 794965 and 796251.

Thanks!

I was able to solve part of my issue by following the clues in 805308. 
Getting the sourcemap contents did let my scss file map, but the css file doesn't. Which means any changes I make to the scss file gets saved to my local machine, sass recompiles, and then nothing... Chrome never changes the displayed styling as it's still using the remote css file and not my local one. Because it never got mapped. The complete lack of any documentation for persistence 2.0 along with absolutely no error messages and the removal of the manual option has made workspaces essentially worthless since persistence 2.0 became the main workspaces system. Any resolution or guide on how to get dev tools to actually map my resources correctly would be greatly appreciated. 

Workspaces 2.0 is imperfect and there's no feasible way to make it work for everybody. Archiving since we currently don't have resources to allocate towards improving Workspaces story.