See edit at the end of the question
All the references in this question refer to Quantum algorithm for solving linear systems of equations (Harrow, Hassidim & Lloyd, 2009).
HHL algorithm consists in an application of the quantum phase estimation algorithm (QPE), followed by rotations on an ancilla qubit controlled by the eigenvalues obtained as output of the QPE. The state of the quantum registers after the rotations is $$ \sum_{j=1}^{N} \sum_{k=0}^{T-1} \alpha_{k|j}\beta_j \vert \tilde\lambda_k\rangle \vert u_j \rangle \left( \sqrt{1 - \frac{C^2}{\tilde\lambda_k^2}} \vert 0 \rangle + \frac{C}{\tilde\lambda_k}\vert 1 \rangle \right). $$
Then, the algorithm just uncomputes the first register containing the eigenvalues ($\vert \tilde\lambda_k \rangle$) to give the state $$ \sum_{j=1}^{N}\beta_j \vert u_j \rangle \left( \sqrt{1 - \frac{C^2}{\lambda_j^2}} \vert 0 \rangle + \frac{C}{\lambda_j}\vert 1 \rangle \right). $$
Here, the notation used assumes that the QPE was perfect, i.e. the approximations were the exact values.
The next step of the algorithm is to measure the ancilla qubit (the right-most one in the sum above) and to select the output only when the ancilla qubit is measured to be $\vert 1 \rangle$. This process is also called "post-selection".
The state of the system after post-selecting (i.e. after ensuring that the measurement returned $\vert 1 \rangle$) is written
$$ \frac{1}{D}\sum_{j=1}^{N}\beta_j \frac{C}{\lambda_j} \vert u_j \rangle $$ where $D$ is a normalisation constant (the exact expression can be found in the HHL paper, page 3).
My question: Why is the $\frac{C}{\lambda_j}$ coefficient still in the expression? From what I understood, measuring $$ \left( \sqrt{1 - \frac{C^2}{\lambda_j^2}} \vert 0 \rangle + \frac{C}{\lambda_j}\vert 1 \rangle \right) $$ should output $\vert 0 \rangle$ or $\vert 1 \rangle$ and destroy the amplitudes in front of those states.
EDIT: Specifying the question.
Following @glS' answer, here is the updated question:
Why does the post-selection works like described by @glS' answer and not like above?