I have a fresh install, but have this problem too. After some searching, I believe the cause for me is that Docker Desktop is automatically trying to create a 1TB Docker.raw file in my encrypted home folder at .docker/desktop/vms/0/data. It’s taking forever to do this and I’m still watching the file grow. It never asked me where I wanted this file or how large I wanted it to be!
From what I read online, I can change this in the Docker Desktop GUI config later and the file will be deleted and recreated, but I can’t get into the GUI since it says “Starting the Docker Engine…” https://docs.docker.com/desktop/troubleshoot-and-support/faqs/linuxfaqs/#where-does-docker-desktop-store-linux-containers
At first I thought it was in error until I found this info in the logs from running:
journalctl --user --unit=docker-desktop -r
com.docker.backend[35502]: [23:38:34.934542058Z][main.engines ] waiting for linux/qemu VM to start
com.docker.backend[35502]: [23:38:34.934566555Z][main.engines ] running engine linux/qemu
com.docker.backend[35502]: [23:38:34.934602222Z][main.events ] adding server timestamp to event (unix): 1742859514934587204 (checking preconditions)
com.docker.backend[35502]: [23:38:34.934652828Z][main.statehandler ] sending to Dashboard: starting
com.docker.backend[35502]: [23:38:34.934695670Z][main.events ] adding server timestamp to event (unix): 1742859514934692584 (initializing VM configuration)
com.docker.backend[35502]: [23:38:34.934734994Z][main.statehandler ] sending to Dashboard: starting
com.docker.backend[35502]: [23:38:34.934779679Z][main.engines.unix ] Setting up VM directory: "/home/user/.docker/desktop/vms/0"
com.docker.backend[35502]: [23:38:34.934845404Z][main.engines.unix ] gather kernel command line arguments
com.docker.backend[35502]: [23:38:34.934873337Z][main.engines.unix ] VM will connect to host using tcp+connect://192.168.x.x:xxxx
com.docker.backend[35502]: [23:38:34.934899837Z][main.engines.unix ] initializing the qemu process virtiofs filesharing mode
com.docker.backend[35502]: [23:38:34.934920146Z][main.events ] adding server timestamp to event (unix): 1742859514934917922 (preparing VM for startup)
com.docker.backend[35502]: [23:38:34.934954722Z][main.statehandler ] sending to Dashboard: starting
com.docker.backend[35502]: 2025/03/24 19:38:34 INFO : hyperkit: Create "/home/user/.docker/desktop/vms/0/data/Docker.raw"
com.docker.backend[35502]: 2025/03/24 19:38:34 INFO : hyperkit: Resize "/home/user/.docker/desktop/vms/0/data/Docker.raw" from 0MiB to 1048576MiB
I tried the solution I found here, to just delete the file and hope for an error, that would then let me in the GUI so I could change the disk size setting, but so far that hasn’t worked. I’ll keep trying or see if I can find the config files to change this from outside of the GUI.
Update - Deleting the Docker.raw file didn’t help; Docker Desktop didn’t give an error after a long time of waiting and when I relaunched it, just creates the file again. I created creating an empty file, but the app just starts auto growing the file when it launches.
So, I removed permission from the file and then it threw an error. However, the only options were to collect diagnostic data or Reset to Factory settings. The only option that would let me into the GUI long enough to see that the default disk size is set to 1TB, is to click the button to reset to factory and then not close the next pop-up. I tried making the change, but after it relaunches, it does reset the settings back to factory. I will let this run overnight and almost completely fill up my disk so I can hopefully change this setting successfully. 
This seems like an oversight that we can’t get to this setting to change it until this HUGE disk file is created or that we’re not asked what we’d like before the app starts.