Try to fit that with "Mount Doom" p.223, three pages from the end of the chapter:

"Then his wrath blazed in consuming flame, but his fear rose like a vast black smoke to choke him. For he knew his deadly peril and the thread upon which his doom now hung."

Who cares about Frodo and Sam being "so close"? The point is that the ring is about to be destroyed. And of course it would harm him, and of course Sauron knew that.

: : : I don't believe that Gandalf, or any of the wise, realized that destroying the ring would also destroy Sauron. Their intent from the onset was to destroy the ring in order to prevent Sauron from regaining and using it.

: : But see, here's one problem: Gandalf says on many occasions that destroying the ring would destroy Sauron. I've listed some of the passages in other posts. One is in "The Last Debate" (which led to the dispute on whether Gandalf would lie or not).
: : You're right that it doesn't make much sense to suppose that Gandalf would know this about the ring when Sauron doesn't! Yet Gandalf does seem to know it. And he claims that Sauron doesn't.
: : That's why I said it was a whopper. I think Gandalf just misspoke.

: In the early instances, just what did Gandalf mean by "destroy Sauron"? Did he mean kill Sauron outright, or did he mean something entirely different. Perhaps he ment that destruction of the ring would ruin, or weaken, Sauron to the point where he would no longer pose a threat.

Well, Aelmer -- I'm going to leave it up to you to find a piece of text that suggests this sort of interpretation. I can't find it. Gandalf and Elrond both speak with great certainty about how Sauron will not be finally destroyed until the ring is, nor will the foundations of Barad-dur.
I think if you consider the text, it will clearly bear out what I'm saying.

: The Last Debate, my pep talk comment aside, is something entirely different.

I don't mind your switching tactics -- but keep in mind that this is now the polar opposite of your last hypothesis. Before Gandalf didn't mean it when he said this. Now he has it on divine authority. The mere fact that you've had to switch your claim so completely is some proof that the position you're defending is hard to maintain.

:At this time, Gandalf had come back as "the White". We do not know what knowledge was imparted to him prior to his return. It is entirely possible that Gandalf did in fact know what would happen when the ring was destroyed.

Yes. But that's the problem with divine authority -- it's a little too convenient. But still, let's consider it.

Even if true, I think it's irrelevant, since Gandalf already expresses this certainty as Gandalf the Grey.