docs: improve local setup guide

[Shreyas-Microsoft]

Purpose

Successfully updated the LocalSetupGuide.md to follow the comprehensive structure and format of the reference document.

Summary of Changes
The updated guide now includes:

✅ Improved Introduction - Clear overview with multi-service architecture explanation
✅ Important Setup Notes - Terminal organization, path conventions, and configuration file details
✅ Step 1: Prerequisites - Platform-specific installation instructions for Windows (native & WSL2) and Linux
✅ Step 2: Development Tools - VS Code extensions, settings, and development container setup
✅ Step 3: Azure Infrastructure - Authentication, resource group creation, infrastructure deployment, and RBAC permissions
✅ Step 4: Backend Setup - Complete backend API configuration, dependencies, and startup instructions
✅ Step 5: Frontend Setup - Frontend installation, Azure AD configuration, and development server startup
✅ Step 6: Verification - Service status checklist and quick verification steps
✅ Step 7: Debugging - VS Code debugging configuration and logging setup
✅ Step 8: Docker - Optional containerized development instructions
✅ Comprehensive Troubleshooting - Expanded common issues with solutions and debug mode checklist
✅ Step 9: Next Steps - Clear guidance on what to do after setup
✅ Related Documentation - Updated links to other guides

The document now provides a professional, step-by-step guide with clear terminal organization, detailed explanations, and improved user experience following the reference format.

Does this introduce a breaking change?

• Yes
• No

Golden Path Validation

• I have tested the primary workflows (the "golden path") to ensure they function correctly without errors.

Deployment Validation

• I have validated the deployment process successfully and all services are running as expected with this change.

What to Check

Verify that the following are valid

• ...

Other Information