sbt under wsl2 throws "Operation not permitted" - sbt

Question

Trying to use sbt on Windows11 under WSL2, getting exceptions for most operations. I can start sbt, but for most commands it throws some variation of java.nio.file.FileSystemException Operation not permitted.
Using Windows11 Pro, latest patches, WSL2 with Ubuntu 22.04 LTS, sbt 1.4.7, Java 11.
What is going on and how can I fix this?
For instance, for reload:
reload
[info] welcome to sbt 1.4.7 (Ubuntu Java 11.0.16)
[info] loading settings for project my-project-build from plugins.sbt ...
[info] loading project definition from /full/path/to/my/project/project
[error] stack trace is suppressed; run last dependencyPositions for the full output
[error] (dependencyPositions) java.nio.file.FileSystemException: /full/path/to/my/project/project/target/streams/_global/dependencyPositions/_global/streams/update_cache_2.12/output_dsp: Operation not permitted
last dependencyPositions
[error] java.nio.file.FileSystemException: /full/path/to/my/project/target/streams/_global/dependencyPositions/_global/streams/update_cache_2.12/output_dsp: Operation not permitted
[error] at java.base/sun.nio.fs.UnixException.translateToIOException(UnixException.java:100)
[error] at java.base/sun.nio.fs.UnixException.rethrowAsIOException(UnixException.java:111)
[error] at java.base/sun.nio.fs.UnixException.rethrowAsIOException(UnixException.java:116)
[error] at java.base/sun.nio.fs.UnixFileAttributeViews$Basic.setTimes(UnixFileAttributeViews.java:125)
[error] at java.base/java.nio.file.Files.setLastModifiedTime(Files.java:2355)
[error] at sbt.io.JavaMilli$.$anonfun$setModifiedTime$1(JavaMilli.scala:25)
[error] at scala.runtime.java8.JFunction0$mcV$sp.apply(JFunction0$mcV$sp.java:23)
[error] at sbt.io.JavaMilli$.mapNoSuchFileException(JavaMilli.scala:31)
[error] at sbt.io.JavaMilli$.setModifiedTime(JavaMilli.scala:24)
[error] at sbt.internal.io.Milli$.setModifiedTime(Milli.scala:386)
[error] at sbt.io.IO$.$anonfun$setModifiedTimeOrFalse$1(IO.scala:1433)
[error] at sbt.internal.io.Retry$.apply$mVc$sp(Retry.scala:40)
[error] at sbt.internal.io.Retry$.apply$mVc$sp(Retry.scala:23)
[error] at sbt.io.IO$.setModifiedTimeOrFalse(IO.scala:1433)
[error] at sbt.internal.InMemoryCacheStore$CacheStoreImpl.write(InMemoryCacheStore.scala:77)
[error] at sbt.util.Tracked$.$anonfun$lastOutput$1(Tracked.scala:74)
[error] at sbt.Classpaths$.$anonfun$dependencyPositionsTask$5(Defaults.scala:3550)
[error] at sbt.Classpaths$.$anonfun$dependencyPositionsTask$5$adapted(Defaults.scala:3516)
[error] at sbt.util.Tracked$.$anonfun$inputChangedW$1(Tracked.scala:219)
[error] at sbt.Classpaths$.$anonfun$dependencyPositionsTask$1(Defaults.scala:3552)
[error] at scala.Function1.$anonfun$compose$1(Function1.scala:49)
[error] at sbt.internal.util.$tilde$greater.$anonfun$$u2219$1(TypeFunctions.scala:62)
[error] at sbt.std.Transform$$anon$4.work(Transform.scala:68)
[error] at sbt.Execute.$anonfun$submit$2(Execute.scala:282)
[error] at sbt.internal.util.ErrorHandling$.wideConvert(ErrorHandling.scala:23)
[error] at sbt.Execute.work(Execute.scala:291)
[error] at sbt.Execute.$anonfun$submit$1(Execute.scala:282)
[error] at sbt.ConcurrentRestrictions$$anon$4.$anonfun$submitValid$1(ConcurrentRestrictions.scala:265)
[error] at sbt.CompletionService$$anon$2.call(CompletionService.scala:64)
[error] at java.base/java.util.concurrent.FutureTask.run(FutureTask.java:264)
[error] at java.base/java.util.concurrent.Executors$RunnableAdapter.call(Executors.java:515)
[error] at java.base/java.util.concurrent.FutureTask.run(FutureTask.java:264)
[error] at java.base/java.util.concurrent.ThreadPoolExecutor.runWorker(ThreadPoolExecutor.java:1128)
[error] at java.base/java.util.concurrent.ThreadPoolExecutor$Worker.run(ThreadPoolExecutor.java:628)
[error] at java.base/java.lang.Thread.run(Thread.java:829)
[error] (dependencyPositions) java.nio.file.FileSystemException: /full/path/to/my/project/target/streams/_global/dependencyPositions/_global/streams/update_cache_2.12/output_dsp: Operation not permitted