The Seven and the Nine

[Alfirin]

In the book Gandalf refers to Sauron in his mastery of the rings as "He who holds the Seven, and the Nine" (the seven dwarven rings, and the nine mortal). I get the "nine" part but, since three of the Dwarven rings were destroyed before Sauron could get his hands on them again, why is Gandalf still counting them? Gandalf presumably knows the rings were destroyed since he makes mention of Dragon fire as being one of the possible ways the One ring could have been destroyed (at least, could have if any dragons of sufficient caliber were still left, which there aren't) Yes Sauron WOULD be the master/holder of all seven rings if they were still extant, but they aren't. And since that statement occurs AFTER the council, Pippin would probably ALSO know about the destruction of the three (the history of the ring would likey have also contained mention of what had happened to the other rings, if for no other reason that someone else (Gimli, possibly since he would be the most versed in Dwarf History) making the same melting suggestion. and Gandalf can't be including the elven three in the count since 1. Sauron doesn't hold them and 2. Even if he did, Gandalf would not lump them together (He would say "the holder of the Three, and the Four, and the Nine")