Because those borders leave Israel in an untenable defensive position facing an implacably hostile neighbor. The avowed aim of Arafat and the Palestinians is to push the Jews into the sea. To believe that this will be changed by withdrawal to pre-1967 borders ignores the attacks on Israel prior to 1967. Why should the Jews be required to assist enemies who have shown their agenda to destroy Israel many times?
As for the Saudi proposal for "peace", its such a sham that I'm surprised that even Powell would fall for it. Withdraw to pre-1967 borders (see above), give Palestinians the right of return (thus allowing massive numbers of the enemy into the country), and the Arabs will normalize relations with Israel (an empty promise at best). Anyone who would fall for this would buy a used Yugo.