After looking at this again, I think the entire example should be removed.  We really don't want to encourage people to code like this (it would never make it through a code review).  The example itself is silly (not fully, just weird and lacking real-world motiviation).  The s.insert(0,x) code is an anti-pattern.  And in general, mutating a data structure while iterating over it is a perilous practice leading to fragile code (many data structures ban the practice outright: databases, deques, dicts).

Mutating while iterating is only safe if a data structure makes explicit guarantees about how it iterates.  In Python, we have only a handful of such guarantees (you can safely mutate dict values while iterating over the keys and lists guarantee that the iterator looks-up consecutive indicies regardless of changes to the underlying list).

I propose to remove the last two paragraphs and the example, replacing them with clear practical advice and patterns that would pass a code review.

Something like this:

    Code that modifies a collection while iterating over
    that same collection can be tricky to get right.  Instead,
    it is usually more straight-forward to loop over a copy
    of the collection or to create a new collection.

    # Strategy:  Iterate over a copy
    for user, status in users.copy():
        if status == 'inactive':
            del users[user]

    # Strategy:  Create a new collection
    active_users = {}
    for user, status in users.items():
        if status == 'active':
            active_users[user] = status