This is where Lincoln tries to avoid any legal entanglements with the slavery-friendly Supreme Court. By confining his authority to commander in chief suppressing a rebellion, Lincoln prevented the Supreme Court from ruling the Emancipation Proclamation unconstitutional.
Of course, by confining it to areas of rebellion, Lincoln had to exclude areas that had been recaptured by the Union, as indicated in the second paragraph that excludes areas of Louisiana and Virginia. In fact, Lincoln left this paragraph with blanks in it until the day before it was published, waiting for word from military commanders about any new territories that could be added. By listing counties individually, Lincoln was able to avoid slaveholders' lawsuits in federal courts -- even though these same slaveholders only a few weeks earlier did not recognize the U.S. federal court system because they were part of the Confederacy.
The "forty-eight counties designated as West Virginia" is the area of Appalachian Virginia that didn't favor succession and broke free of Virginia to rejoin the Union. West Virginia voted to abolish slavery within six months of the Emancipation Proclamation.