Thanks for the help
As indicated in a previous thread, a select by location will use only the selected points in the next step. There is no reason to remove/hide points that aren't selected. Your model would then have to clip the original data using the buffer, then remove the original layer... making the model unwieldy and not something really appropriate to modelbuilder, but perhaps python scripting using the mapping module.
Is there a reason that you want the points outside the buffer to 'disappear" other than aesthetics?
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