RDP becomes unresponsive when closing laptop lid (but host is not in sleep)

Question

Hello,

My setup at home:

• Windows 10 laptop (work) connected through wifi and power delivered through USB-C cable.
• Windows 10 workstation (private) , wired connection.
• I log into my work laptop from my workstation using RDP, the laptop usually remains with the lid closed, everything works as expected.

Problem: If I disconnect the power cable (USB-C) from my laptop, then keyboard and mouse inputs stop working through the RDP connection. Some could ask why I am doing this, the reason is that I want my laptop battery to not stay charged 100% continuously when working from home.

Although the mouse and keyboard input stop working, here is what keeps working after I unplug the power cable (laptop lid is always closed):

1. Inbound network remains responsive: I can ping the laptop after the cable is unplugged.
2. Outbound network remains responsive: if I ping my workstation continuously from the laptop, the workstation keeps receiving ICMP requests after the cable is unplugged.
3. Sound remains responsive: I start playing a video on the laptop, I keep hearing the sound in the speakers after the cable is unplugged.
4. Video remains responsive: the video also keeps playing through the RDP link when the cable is unplugged.

Strangest of all: If I open the lid, while the power cable is disconnected, then the mouse and keyboard input start responding again through RDP.

Something very specific happens when the lid is closed + the power cable removed, that only results in the interruption of mouse/keyboard traffic from the RDP client to the RDP host.

Any ideas?

[EDITS: fixing grammar errors]