fix(appset): do not remove progressive sync conditions (#23506)

Signed-off-by: Alexandre Gaudreault <alexandre_gaudreault@intuit.com>

resource_customizations/argoproj.io/ApplicationSet/health.lua

@@ -8,6 +8,22 @@ if obj.status ~= nil then
         hs.message = condition.message
         return hs
       end
+    end
+    for i, condition in pairs(obj.status.conditions) do
+      if condition.type == "ResourcesUpToDate" and condition.status == "False" then
+        hs.status = "Degraded"
+        hs.message = condition.message
+        return hs
+      end
+    end
+    for i, condition in pairs(obj.status.conditions) do
+      if condition.type == "RolloutProgressing" and condition.status == "True" then
+        hs.status = "Progressing"
+        hs.message = condition.message
+        return hs
+      end
+    end
+    for i, condition in pairs(obj.status.conditions) do
       if condition.type == "ResourcesUpToDate" and condition.status == "True" then
         hs.status = "Healthy"
         hs.message = condition.message

resource_customizations/argoproj.io/ApplicationSet/health_test.yaml

@@ -1,13 +1,21 @@
 tests:
   - healthStatus:
       status: Healthy
-      message: "ApplicationSet up to date"
+      message: ApplicationSet up to date
     inputPath: testdata/healthyApplicationSet.yaml
   - healthStatus:
       status: Degraded
-      message: "found less than two generators, Merge requires two or more"
+      message: found less than two generators, Merge requires two or more
     inputPath: testdata/errorApplicationSetWithStatusMessage.yaml
   - healthStatus:
       status: Progressing
-      message: "Waiting for the status to be reported"
+      message: Waiting for the status to be reported
     inputPath: testdata/noStatusApplicationSet.yaml
+  - healthStatus:
+      status: Degraded
+      message: could not create application
+    inputPath: testdata/resourceNotUpdatedApplicationSet.yaml
+  - healthStatus:
+      status: Progressing
+      message: ApplicationSet is performing rollout of step 1
+    inputPath: testdata/progressiveSyncApplicationSet.yaml

resource_customizations/argoproj.io/ApplicationSet/testdata/progressiveSyncApplicationSet.yaml

@@ -0,0 +1,58 @@
+apiVersion: argoproj.io/v1alpha1
+kind: ApplicationSet
+metadata:
+  name: cluster-git
+  namespace: argocd
+spec:
+  generators:
+    - merge:
+        generators: []
+        mergeKeys:
+          - server
+  strategy:
+    rollingSync:
+      steps:
+        - matchExpressions:
+            - key: env
+              operator: In
+              values:
+                - dev
+        - matchExpressions:
+            - key: env
+              operator: In
+              values:
+                - prod
+  template:
+    metadata:
+      name: '{{name}}'
+    spec:
+      destination:
+        namespace: default
+        server: '{{server}}'
+      project: default
+      source:
+        path: helm-guestbook
+        repoURL: https://github.com/argoproj/argocd-example-apps/
+        targetRevision: HEAD
+status:
+  conditions:
+    - lastTransitionTime: '2025-05-30T15:41:02Z'
+      message: All applications have been generated successfully
+      reason: ApplicationSetUpToDate
+      status: 'False'
+      type: ErrorOccurred
+    - lastTransitionTime: '2025-05-27T18:45:48Z'
+      message: Successfully generated parameters for all Applications
+      reason: ParametersGenerated
+      status: 'True'
+      type: ParametersGenerated
+    - lastTransitionTime: '2025-05-30T15:41:02Z'
+      message: All applications have been generated successfully
+      reason: ApplicationSetUpToDate
+      status: 'True'
+      type: ResourcesUpToDate
+    - lastTransitionTime: '2025-05-30T15:44:06Z'
+      message: ApplicationSet is performing rollout of step 1
+      reason: ApplicationSetModified
+      status: 'True'
+      type: RolloutProgressing

resource_customizations/argoproj.io/ApplicationSet/testdata/resourceNotUpdatedApplicationSet.yaml

@@ -0,0 +1,40 @@
+apiVersion: argoproj.io/v1alpha1
+kind: ApplicationSet
+metadata:
+  name: cluster-git
+  namespace: argocd
+spec:
+  generators:
+    - merge:
+        generators: []
+        mergeKeys:
+          - server
+  template:
+    metadata:
+      name: '{{name}}'
+    spec:
+      destination:
+        namespace: default
+        server: '{{server}}'
+      project: default
+      source:
+        path: helm-guestbook
+        repoURL: https://github.com/argoproj/argocd-example-apps/
+        targetRevision: HEAD
+status:
+  conditions:
+    - lastTransitionTime: '2025-05-30T15:41:02Z'
+      message: All applications have been generated successfully
+      reason: ApplicationSetUpToDate
+      status: 'False'
+      type: ErrorOccurred
+    - lastTransitionTime: '2025-05-27T18:45:48Z'
+      message: Successfully generated parameters for all Applications
+      reason: ParametersGenerated
+      status: 'True'
+      type: ParametersGenerated
+    - lastTransitionTime: '2025-05-30T15:41:02Z'
+      message: 'could not create application'
+      reason: CreateApplicationError
+      status: 'False'
+      type: ResourcesUpToDate