After some analyse, the plugin is working as expected and it is more an issue with how Jenkins is loading the plugins (that's why the workaround works) and the list of suggested plugins.
Some context: FolderCredentialsProvider is an optional Extension. It's making use of credentials-plugin features and this plugin is an optional dependency, so it's not installed by default. This behaviour is intended since this extension is not used by cloudbees-folder per se but it exposes it to be used by other plugins. It's responsibility of other plugins to ensure this Extension is loaded via their dependencies. One of the pipeline plugins is using the Extension, so it needs it to be loaded, and they have the dependencies well configured.
What's happening: In the list of suggested plugins cloudbees-folder is installed before any of the pipeline plugins. As credentials is an optional dependency, the plugin is not installed. When FolderCredentialsProvider is being loaded the class itself is loaded but not the Extension in the Jenkins instance since all the classes from credentials are not present. cloudbees-folder is loaded correctly although Jenkins has not loaded the Extension.
Then the pipeline plugins are installed. They have dependencies on cloudbees-folder and credentials that are not optional. That installs credentials but not cloudbees-folder, which is already installed and loaded but without the mentioned Extension. That means that:
- when you want to create the Multibranch Pipeline, this job needs FolderCredentialsProvider, that is not loaded and that's why you receive the message about the failure instantiating the component.
- if you install all suggested plugins except on cloudbees-folders, when pipeline is going to be installed it will install credentials and cloudbees-folder and the extension FolderCredentialsProvider will be instantiated because the credentials is installed as well.
Why the workaround works: When you restart the instance, the three plugins are installed, so FolderCredentialsProvider will find the classes from credentials.
Maybe, if any fix is really needed, it makes more sense to fix the core to mark cloudbees-folder as not suggested (it's loaded by other suggested plugins) here: https://github.com/jenkinsci/jenkins/blob/9c9a8978eeeef918bfb62c335da0a30bcfb6ac20/core/src/main/resources/jenkins/install/platform-plugins.json#L6