The "Navigation Pane" in Windows explorer seems a reasonable example of what you are trying to achieve. It looks almost exactly like your example screenshot, albeit with the arrowheads on the left instead of on the right. Click the arrowhead to expand/collapse, and the text next to it to select.
Having a checkbox list should meet the requirements. This is a common pattern and should be easy to implement. Clicking on the container expands or collapses the node, while the checkbox is used for selection.