In my Calculus classes I really like using the function $f(x) = \frac{1-x^2}{1-x}$ as a running example. First I use it to exemplify how the definition of a function must include information about its domain. For instance, $f$ is not quite the same as the function $1+x$.
Later, I se $f$ to talk about continuity, because it is a good example of a function that is not continuous at exactly one point, even though the limit exists. Then we talk about how you can extend a function by continuity, thus recovering $1+x$.
Finally, we use $f$ to visualize the derivative of $x^2$ at $x=1$. The point I make is that the quotient definition of derivative needs to use a limit, because the quotient itself is not defined. Usually (meaning for quite a few students) the understanding of the continuity issue becomes ingrained as a collateral effect of understanding the definition of derivative. And that kind of is the point in a Calculus class, right?
(As an aside, I also use $f$ in Complex Analysis, now as a function of a complex variable, to explain the subtle notion of a removable singularity. Without a concrete example, they usually miss that there is meat to this definition.)