diff --git a/components/server/src/workspace/workspace-starter.ts b/components/server/src/workspace/workspace-starter.ts
index 4c0cd0537b1635..0105f862983b6e 100644
--- a/components/server/src/workspace/workspace-starter.ts
+++ b/components/server/src/workspace/workspace-starter.ts
@@ -368,31 +368,13 @@ export class WorkspaceStarter {
                     workspace.context,
                 );
 
-                const forceRebuild = !!workspace.context.forceImageBuild;
-                try {
-                    // if we need to build the workspace image we must not wait for actuallyStartWorkspace to return as that would block the
-                    // frontend until the image is built.
-                    const additionalAuth = await this.getAdditionalImageAuth(envVars);
-                    const needsImageBuild =
-                        forceRebuild || (await this.needsImageBuild(ctx, user, workspace, instance, additionalAuth));
-                    if (needsImageBuild) {
-                        instance.status.conditions = {
-                            neededImageBuild: true,
-                        };
-                    }
-                    ctx.span?.setTag("needsImageBuild", needsImageBuild);
-                } catch (err) {
-                    // if we fail to check if the workspace needs an image build (e.g. becuase the image builder is unavailable),
-                    // we must properly fail the workspace instance, i.e. set its status to stopped, deal with prebuilds etc.
-                    //
-                    // Once we've reached actuallyStartWorkspace that function will take care of failing the instance.
-                    await this.failInstanceStart(ctx, err, workspace, instance, abortSignal);
-                    throw err;
-                }
-
-                await this.actuallyStartWorkspace(ctx, instance, workspace, user, envVars, abortSignal, forceRebuild);
+                await this.actuallyStartWorkspace(ctx, instance, workspace, user, envVars, abortSignal);
             } catch (err) {
-                log.error({ instanceId }, "error in reconcileWorkspaceStart", err);
+                this.logAndTraceStartWorkspaceError(
+                    ctx,
+                    { userId: user.id, workspaceId: workspace.id, instanceId },
+                    err,
+                );
             } finally {
                 ctx.span.finish();
             }
@@ -532,7 +514,6 @@ export class WorkspaceStarter {
         user: User,
         envVars: ResolvedEnvVars,
         abortSignal: RedlockAbortSignal,
-        forceRebuild?: boolean,
     ): Promise<void> {
         const span = TraceContext.startSpan("actuallyStartWorkspace", ctx);
         const region = instance.configuration.regionPreference;
@@ -543,6 +524,7 @@ export class WorkspaceStarter {
             organizationId: workspace.organizationId,
             workspaceId: workspace.id,
         };
+        const forceRebuild = !!workspace.context.forceImageBuild;
         log.info(logCtx, "Attempting to start workspace", {
             forceRebuild: forceRebuild,
         });
@@ -1216,6 +1198,18 @@ export class WorkspaceStarter {
         const span = TraceContext.startSpan("buildWorkspaceImage", ctx);
 
         try {
+            // TODO(gpl) I looks like we really don't need the whole "needsImageBuild" anymore:
+            // Before we used it to distinguish between sync/async, now we are always async.
+            // Still keeping it here for now to understand whether there are any side effects in image-builder-mk3
+            const needsImageBuild =
+                forceRebuild || (await this.needsImageBuild(ctx, user, workspace, instance, additionalAuth));
+            if (needsImageBuild) {
+                instance.status.conditions = {
+                    neededImageBuild: true,
+                };
+            }
+            ctx.span?.setTag("needsImageBuild", needsImageBuild);
+
             // Start build...
             const client = await this.getImageBuilderClient(user, workspace, instance, region);
             const { src, auth, disposable } = await this.prepareBuildRequest(
@@ -1352,7 +1346,11 @@ export class WorkspaceStarter {
             await this.failInstanceStart({ span }, err, workspace, instance, abortSignal);
 
             const looksLikeUserError = (msg: string): boolean => {
-                return msg.startsWith("build failed:") || msg.includes("headless task failed:");
+                return (
+                    msg.startsWith("build failed:") ||
+                    msg.includes("headless task failed:") ||
+                    msg.includes("cannot resolve image")
+                );
             };
             if (looksLikeUserError(message)) {
                 log.info(