[BUG] watch says: Error response from daemon: cannot overwrite non-directory "xxx" with directory "yyy"

[lumbric]

Description

When I do a docker compose up --watch I get the error:

copying files to dff6....: Error response from daemon: cannot overwrite non-directory "/some/path/in/image" with directory "/"

In this case /some/path/in/image is a relative symlink.

The error occurs only with ---watch which probably means that this is an issue with the initial sync of compose watch.

Steps To Reproduce

Unfortunately I have not managed to reproduce the issue, but I have seen it multiple times.

• It always occurs after switching to a Git commit where folder structure is entirely different.
• The first time I was able to fix it by running docker system prune. The second time by docker compose build --no-cache.
• The error occurs only with --watch. I can start containers successfully without watch.

Compose Version

$ docker compose version
Docker Compose version v5.1.3

Docker Environment

$ docker info
Client: Docker Engine - Community
 Version:    29.5.0
 Context:    default
 Debug Mode: false
 Plugins:
  buildx: Docker Buildx (Docker Inc.)
    Version:  v0.34.0
    Path:     /usr/libexec/docker/cli-plugins/docker-buildx
  compose: Docker Compose (Docker Inc.)
    Version:  v5.1.3
    Path:     /usr/libexec/docker/cli-plugins/docker-compose

Server:
 Containers: 7
  Running: 3
  Paused: 0
  Stopped: 4
 Images: 10
 Server Version: 29.5.0
 Storage Driver: overlayfs
  driver-type: io.containerd.snapshotter.v1
 Logging Driver: json-file
 Cgroup Driver: systemd
 Cgroup Version: 2
 Plugins:
  Volume: local
  Network: bridge host ipvlan macvlan null overlay
  Log: awslogs fluentd gcplogs gelf journald json-file local splunk syslog
 CDI spec directories:
  /etc/cdi
  /var/run/cdi
 Swarm: inactive
 Runtimes: io.containerd.runc.v2 runc
 Default Runtime: runc
 Init Binary: docker-init
 containerd version: 77c84241c7cbdd9b4eca2591793e3d4f4317c590
 runc version: v1.3.5-0-g488fc13e
 init version: de40ad0
 Security Options:
  apparmor
  seccomp
   Profile: builtin
  cgroupns
 Kernel Version: 6.1.0-44-amd64
 Operating System: Neptune 8.2
 OSType: linux
 Architecture: x86_64
 CPUs: 12
 Total Memory: 33.64GiB
 Name: longy0201
 ID: 2b992073-edb2-48f1-b2c1-81e969c69a58
 Docker Root Dir: /var/lib/docker
 Debug Mode: false
 Experimental: false
 Insecure Registries:
  ::1/128
  127.0.0.0/8
 Live Restore Enabled: false
 Firewall Backend: iptables
  EnableUserlandProxy: true
  UserlandProxyPath: /usr/bin/docker-proxy

Anything else?

No response