How can I trigger proper insertion animations in LazyVStack without re-rendering all views?

It turn is out LazyVStack is literally lazy! I scavenged removed items ids to use the animation on new "Items".

SWIFTCopied
import SwiftUI

struct ContentView: View {
    
    @State private var items: [ItemType] = [ItemType]()
    @State private var removedItemIDs: [UUID] = [UUID]()
    
    var body: some View {
        VStack {
            ScrollView {
                LazyVStack(spacing: 5.0) {
                    ForEach(items) { item in
                        CircleView(item: item)
                            .transition(
                                .asymmetric(
                                    insertion: .move(edge: .top),
                                    removal: .move(edge: .top)
                                )
                            )
                        
                    }
                }
                .animation(Animation.linear , value: items)
            }
            .padding()
            
            Spacer()
            
            HStack {
                Button("Append New Item") {
                
                    if (removedItemIDs.isEmpty) {
                        let newItem: ItemType = ItemType(value: items.count + 1)
                        items.append(newItem)
                    }
                    else {
                        let oldID: UUID = removedItemIDs.removeFirst()
                        let newItem: ItemType = ItemType(id: oldID, value: items.count + 1)
                        items.append(newItem)
                    }
                
                }
                
                Button("Remove last Item") {
                    if let last = items.popLast() {
                
                    if (!removedItemIDs.contains(where: { value in (value == last.id) })) {
                        removedItemIDs.append(last.id)
                    }
                        print("Removed:", last.value)
                
                    } else {
                        print("Array is empty!")
                    }
                
                }
            }
        }
        .padding()
    }
    
}

struct CircleView: View, Equatable {
    let item: ItemType
    
    var body: some View {
        print("CircleView called for: " + String(describing: item.value))
        return Circle()
            .fill(Color.red)
            .frame(width: 50.0, height: 50.0)
            .overlay(Circle().stroke(lineWidth: 1.0))
            .overlay(Text("\(item.value)").foregroundStyle(.white))
    }
    
    static func == (lhs: Self, rhs: Self) -> Bool {
        (lhs.item == rhs.item)
    }
}

struct ItemType: Identifiable, Equatable {

    init(id: UUID, value: Int) {
        self.id = id
        self.value = value
    }
    
    init(value: Int) {
        self.id = UUID()
        self.value = value
    }
    
    let id: UUID
    let value: Int
    
    static func == (lhs: Self, rhs: Self) -> Bool {
        (lhs.id == rhs.id) && (lhs.value == rhs.value)
    }
} 

In SwiftUI, Identity is everything. At its data model heart SwiftUI is a giant pile of nested collections that need diffing to detect identity changes and drive animation.

When you do this:

SWIFTCopied
struct ItemType: Identifiable, Equatable {
    let id: UUID = UUID()
    let value: Int
}

You create a new identity for the same value on each instantiation.

so ItemType(value: 42) != ItemType(value: 42)

where you might expect the two structures to be equal as their values are the same.

Their identity, the thing that differentiates one ItemType from another is the value.

When you insert an item after e.g 3 it will always be 4 according to your business logic. However the 4 that you insert does not equal any 4 that may have existed previously as the id has now got a new value.

You (probably) don't introduce yourself with a new name each time you meet someone and that applies to data identity too.

In summary, decide what makes each instance of a data model object different from the other and don't just wedge let id: UUID = UUID() into every data model type to create difference for triggering SwiftUI drawing.

Your modified example, using value to drive the Identifiable conformance of ItemType provides correct animation.

SWIFTCopied
import SwiftUI

struct CircleView: View {
    @State var item: ItemType
    
    var body: some View {
        return Circle()
            .fill(Color.red)
            .frame(width: 50.0, height: 50.0)
            .overlay(Text("\(item.value)").foregroundStyle(.white))
    }
}

struct ItemType: Equatable, Identifiable {
    var id: Int { value }
    let value: Int
}

struct ContentView: View {
    
    @State private var items: [ItemType] = []
    
    var body: some View {
        VStack {
            ScrollView {
                LazyVStack(spacing: 5.0) {
                    ForEach(items) { item in
                        CircleView(item: item)
                            .transition(
                                .asymmetric(
                                    insertion: .move(edge: .top),
                                    removal: .move(edge: .top)
                                )
                            )
                    }
                }
                .animation(Animation.linear , value: items)
            }
            .padding()
            
            Spacer()
            
            HStack {
                Button("Append New Item") {
                    let newItem = ItemType(value: items.count + 1)
                    items.append(newItem)
                }
                
                Button("Remove Last Item") {
                    _ = items.popLast()
                }
                
            }
        }
        .padding()
    }
}

#Preview {
    ContentView()
}

See https://developer.apple.com/videos/play/wwdc2021/10022/ for an expert description of what is going on.