The Following Setup Makes Block A(In My Case Diamond Block) Indestructible, You Can Destroy It But It Instantaneously Reappears Even In Creative. Only Workaround Is To Disable The Circuit.
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This is somewhat accurate. After recreating your setup, and attempting to destroy the block, the behaviour was not consistent. Sometimes, if I tried destroying the block, it would show the destruction animation, but still exist. Other times, the block would end up being destroyed.
Whilst being moved, the diamond block is transformed into "Block 36", which is not breakable. Read http://www.minecraftwiki.net/wiki/Technical_blocks#Piston_Moving
That's true. The diamond block is present only for a very short amount of time before it is pushed again, even too short for breaking it in creative mode.
Please Ignore The Redstone Line Around The Circuit, It Is Not Required And Is There For Looks