As discussed in https://github.com/nushell/nushell/pull/12749, we no
longer need to call `std::env::set_current_dir()` to sync `$env.PWD`
with the actual working directory. This PR removes the call from
`EngineState::merge_env()`.
# Description
Fixes#12813 where a panic occurs when syntax highlighting `not`. Also
fixes#12814 where syntax highlighting for `not` no longer works.
# User-Facing Changes
Bug fix.
