Try installing this package from
Manage pckes and then check if the custom activity is still throwing error UiPath.Workflow.Runtime 6.0.3…system activities are there under this package I believe
I was able to resolve System.Activities error, but then started facing error for other DLL’s.
I am unable to understand, why .Net4 Framework (Windows-Legacy) able to work with simply having installed libraries during code build in VsCode where as Windows is asking for specific path of dll files