Zep, it might help in understanding if we extend the discussion to the ordinal numbers.
No doubt you're familiar with the first ordinals--they are the natural numbers 0, 1, 2, 3,....
There's a standard set theoretic construction of the ordinals (due to von Neumann) which may help in visualizing them (it probably won't help visualizing the finite ones, but it may help for the infinite ones):
1. 0 = {} (the empty set).
2. If n is an ordinal, then define n+1 = n union {n}.
In other words, 2 can be rephrased as saying, "A given ordinal is equal to
the set of smaller ordinals".
The first few ordinals:
0 = {}
1 = {0} = {{}}
2 = {0,1} = {{},{{}}}
3 = {0,1,2} = {{},{{}},{{},{{}}}}
and so on.
So far, we've defined what the first ordinal is, and we've got the
successor ordinal (n+1).
If that was all we had, we could never get an infinite ordinal--you can't reach infinity by starting with zero and adding one over and over again.
We need a new axiom:
The axiom of infinity: There is a set containing 0, and whenever n is in the set, n+1 is also in the set.
w (omega) is defined to be the smallest such set (the set of natural numbers):
w = {0,1,2,3,4,...}
Without the axiom of infinity, the "set" of natural numbers wouldn't actually be a set at all--there's no way to construct it otherwise.
Once you get that first infinite set, however, all hell breaks loose, pretty much. Going back to 2. above, we get:
w+1 = w union {w} = {0,1,2,3,...,w}
w+2 = w+1 union {w+1} ={0,1,2,3,...w, w+1}
w+w = {0,1,2,3,...,w,w+1,w+2,w+3,...}
w+w+1 = {0,1,2,3,...,w,w+1,w+2,w+3,...,w+w}
And so on, going on to ordinals with cardinality larger than w (=the set of finite ordinals (natural numbers)), such as w<sub>1</sub> (=the set of countable ordinals), w<sub>2</sub>,...,w<sub>w</sub>, and so on.
All ordinals are
well-ordered sets, meaning any (nonempty) subset of an ordinal has a smallest element (but not necessarily a largest element--w has no largest element for example (there is no largest natural numbers)). The collection of ordinals itself is
not a set (it's "too big"--it can't be assigned a cardinality), but the
proper class of all ordinals itself is "well-ordered", as well.
You might notice here that there are two types of ordinals. 3, for example, is equal to 2+1. w, on the other hand, can't be written as x+1 for any ordinal x--there is no ordinal immediately before w. This is basically another way of saying, "There is no 'point' at which the natural numbers become an infinite set--if you cut them short at any point, you only have finitely many".
Ordinals of the form x+1 for some x are called
successor ordinals, other (non-zero) ordinals are called
limit ordinals. We can think of a limit ordinal as being the
union of all the ordinals preceding it (w, for example, is the union of all natural numbers).
Now, back to my previous fallacious induction argument. There are two types of induction:
1. Standard induction: P(0) and (P

implies P(n+1)) together imply P(m) for all natural numbers m.
2. Transfinite induction: P(0) and (P

for all n < m implies P(m)) together imply P(x) for all ordinal numbers x.
Type 1 can only handle "jumps" of n+1--it can't make the jump to w, since it isn't of the form n+1. My original proof was of type 1--that proof demonstrated that .999...9 is not equal to 1 for any
finite number of 9's, but can't make that "jump" to say anything about the case with an
infinite number of 9's.
If a similar proof of type 2 could be constructed, however, that wouldn't be a problem. Type 2 just relies on the well-ordering property of the ordinals--it doesn't require the jumps to be made at successor ordinals only, it can handle limit ordinals as well.
Type 1 always breaks down at omega, since omega is the first limit ordinal.
I don't know if any of that really helps at all; this is a huge topic that can be difficult to digest, and difficult to condense into a nutshell. There's so much we know (and much we don't know) about ordinals, but I figure I ought to stop here.