I'm trying to understand the combinatorial identity $ \binom{n+1}{k} = \binom{n}{k-1} + \binom{n}{k}. $ I have a good understanding of the algebraic manipulation involved, but I'm struggling with the following interpretation:
Suppose $k$-subset $A = \{0,1,2,3,...,n\}$ where $A$ has $n+1$ elements.
(1) Now, the subset $\binom{n}{k-1}$ can contain the subset of $A$ containing $0$ because to make that a subset, we can start with $\{0\}$ and append an additional $k-1$ numbers selected from $\{1,2,3,...,n\}$, and there are $\binom{n}{k-1}$ ways to do that.
(2) On the other hand, $\binom{n}{k}$ does not contain $0$ since it is the number of ways to select $k$-element subsets from $\{1,2,...,n\}$.
With statement (2), I don't have any issues; I understand that $A = \{0,1,2,...,n\}$ has $n+1$ elements, and if we remove $0$, we are left with the set $\{1,2,...,n\}$ which has $n$ elements. My problem is with statement (1) as I don't understand if we are saying that $A = \{0,1,2,...,n\}$ of length $n+1$ then why it is still there in $\binom{n}{k-1}$? it's because we remove another element to become $\{0,1,2,3,...,n-1\}$? Additionally, I'm not sure what "we can start with $\{0\}$ and append an additional $k-1$ numbers" means. Does it imply that subsets like $\{0,1\}, \{0,2\}$, etc., can be formed?
Any clarification on this would be greatly appreciated.
P.S. I'm concious that this problem is already here in Mathematics StackExchange, but this way of prooving the problem (with the $0$ cases) is not yet. Prove that $\binom{n+1}k = \binom nk + \binom n {k-1}$

Like you said $\binom{n+1}{k}$ counts how many subsets of $\{0,\dots,n\}$ you can make that contain $k$ (distinct) elements.
Now you can split all these sets in two categories:
Since for a subset in this category you already have $0$ included, to complete the subset all you have to do is pick $k-1$ more elements from the remaining $n$ (remember, we have $n+1$ in total).
Thus the number of subsets with $k$ elements containing $0$ are $\binom{n}{k-1}$.
Since these subsets do not contain $0$, you are basically counting the number of subsets with $k$ (distinct) elements from the set $\{0,\dots,n\}\setminus\{0\}$, which has $n$ elements.
These are precisely $\binom{n}{k}$ in total.
Since a set either does or doesn't contain $0$, the two cases above cover all possible subsets of $\{0,\dots,n\}$ containing $k$ elements, so putting everything together we get the wanted equality: $$\binom{n+1}{k}=\binom{n}{k-1}+\binom{n}{k}$$