Suppose we have a hydraulic press with a smaller area $A_1$ and a bigger area $A_2$, with the smaller area being higher with a height difference of $\Delta h$.
We first calculate the pressure at point A. By Pascal's law, the increase in pressure at point A comes from the pressure created by forces $F$ and the weight $G_m$ of the mass $m$. These pressures get added at each point in the liquid, so for point A we get $p_A = F_1/A_1+F_2/A_2$.
With similar reasoning for point B we get $p_B = F_1/A_1+F_2/A_2+\rho g \Delta h$ where we have now taken into account the hydrostatic pressure from the height difference.
However, if the system is now in equilibrium, at the area $A_2$ we must have equality with pressure from above and pressure from below, so that the forces acting on both sides are equal. This would give $F_1/A_1$ for the pressure from above and $p_A = F_1/A_1+F_2/A_2$ for the pressure from below. This would imply that $F_2=0$ which is a contradiction.
Where am I going wrong? I'm stuck with this and there must be a fundamental misunderstanding somewhere in there. I would really appreciate any pointers.
