What is my mistake in understaning the included paragraph from the spec?

The following is copied from 
https://exim.org/exim-html-current/doc/html/spec_html/ch-file_and_database_lookups.html#SECID60
with one exception.

---> Start of qoute
    1. Examples of different lookup syntax
    ======================================
    It is easy to confuse the two different kinds of lookup, especially as the lists that may contain the second kind are always expanded before being processed as lists. Therefore, they may also contain lookups of the first kind. Be careful to distinguish between the following two examples:

     I) domains = ${lookup{$sender_host_address}lsearch{/some/file}}
    II) domains = lsearch;/some/file
---> End of qoute

The exception in copying, compared to the text in the web site, is the addition 
of the prefixes I) and II) at the begining of the last two lines.

The way I read this text, it reads
    lists that may contain 
        lsearch;/some/file
    are always expanded before being processed as lists. Therefore, they may 
    also contain lookups of the form 
        ${lookup{$sender_host_address}lsearch{/some/file}}

Doesn't that contradicts some lines from the documentation that follows? Namely,

---> Start of qoute
     In the second example, the lookup is a single item in a domain list. It causes Exim to use a lookup to see if the domain that is being processed can be found in the file. The file could contains lines like this:

        domain1:
        domain2:

    Any data that follows the keys is not relevant when checking that the domain matches the list item. 
---> End of qoute

If any data that follows the keys is not relevant when checking that the domain 
matches the list item, how it

    may also contain lookups of the form 
    ${lookup{$sender_host_address}lsearch{/some/file}}

?

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