Binary Subtraction - Python

Short answer: Your code is wrong for the case when s1[i] == s2[i] and carry == 1.

Longer answer: You should restructure your code to have three separate cases for s==-1, s==0, and s==1, and then branch on the value of carry within each case:

if s == -1:  # 0-1
    if carry == 0:
        ...
    else:
        ...
elif s == 0:  # 1-1 or 0-0
    if carry == 0:
        ...
    else:
        ...
else:  # 1-0
    if carry == 0:
         ...
    else:
        ...

This way you have a separate block for each possibility, so there is no chance of overlooking a case like you did on your first attempt.