Apple Final Cut Pro 7 - Manual (Page 476)

Out point inclusive means that when you set an Out point at the position of the playhead,
the frame that the playhead is on is included in your edit. This rule means that whenever
you set In and Out points, the minimum duration set is always one frame long. For
example, if you place the playhead on a specific frame, and then set both an In point and
an Out point, the In point is placed at the beginning of the frame and the Out point is
placed at the end, resulting in a one-frame duration. If this rule did not exist, it would be
possible to create edits with zero duration, which would be useless.
To see exactly how the Out point inclusive rule works
1 Double-click a sequence in the Browser to open it in the Timeline.
2 Choose Mark > Mark In (or press I) to set an In point in the sequence.
3 Move the playhead several seconds later in the Timeline.
4 Press Command-Equal Sign (=) to zoom in closely to the location of the playhead.
You can see that the ruler is highlighted directly after the playhead. The duration of this
highlighted area is one frame.
5 Choose Mark > Mark Out (or press O) to set an Out point in the sequence.
The Out point is placed at the end of the duration of the frame. This is because the Out
point includes the duration of the frame on which the playhead is currently positioned.
In point
The Out point includes
the duration of the frame.
476 Chapter 33 Setting Edit Points for Clips and Sequences