(A) Consider $S=1-1+1-1+1-1\cdots$
It alternates between $0$ & $+1$ , hence there is no limiting value.
We can still attempt this : $S=1-1+1-1+1-1\cdots=1-(1-1+1-1+1\cdots)=1-S$
Hence $2S=1$ where we get $S=1/2$ ??!!
We should not make the Equation without checking whether it "Converges" , otherwise the Equation will give invalid Solution , because the "Convergence Assumption" was invalid to start with . . . .
(B) Consider your Case , where we can try making the Equation without checking for Convergence :
\begin{equation}
(E1) \space\cfrac{1}{1-\cfrac{1}{1-x}}=x
\end{equation}
$(x-1)/x=x$
We get $x^2-x+1=0$ here.
\begin{equation}
(E2) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-x}}}=x
\end{equation}
We get $x=x$ here ??!!
Every number satisfies this Equation !! More-over , all numbers will work out even with the Current Continued Fraction too . . . .
\begin{equation}
(E3) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-x}}}}=x
\end{equation}
$1/(1-x)=x$
We get $x^2-x+1=0$ here.
\begin{equation}
(E4) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-x}}}}}=x
\end{equation}
$(x-1)/x=x$
We get $x^2-x+1=0$ here.
\begin{equation}
(E5) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-x}}}}}}=x
\end{equation}
We get $x=x$ here too ??!!
\begin{equation}
(E6) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-x}}}}}}}=x
\end{equation}
$1/(1-x)=x$
We get $x^2-x+1=0$ here.
Consistency is clearly missing , there is no Unique Equation covering how-ever deep we make the Continued Fraction Structure go.
(C) Consider your Case , where we try checking for Convergence :
Let us take the extended real numbers where we have $1/0=\infty$ , while $1/\infty=0$
\begin{equation}
(C1) \space\cfrac{1}{1-\cfrac{1}{1-1}}=0
\end{equation}
\begin{equation}
(C2) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-1}}}=1
\end{equation}
\begin{equation}
(C3) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-1}}}}=\infty
\end{equation}
\begin{equation}
(C4) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-1}}}}}=0
\end{equation}
\begin{equation}
(C5) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-1}}}}}}=1
\end{equation}
\begin{equation}
(C6) \space\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-\cfrac{1}{1-1}}}}}}}=\infty
\end{equation}
Consistency is clearly missing here , there is no Unique Convergent Value covering how-ever deep we make the Continued Fraction Structure go.
(D) Try the same with all $-$ changed to $+$ :
We will easily see the Convergence ; more-over , we will get the same Equation , no matter how deep we make the Continued Fraction Structure.
Eventually , we will get something involving $\sqrt{5}$ . . . .
(E) SUMMARY :
Check for Convergence before making the Equation , else the Equation is going to be meaningless towards getting value of the given non-number !