You hit on the answer there but still don't grasp that you did. Let me help clarify what you said by croppping off the flab:
"War causes enough grief so that the parties finally decide to seriously work out a solution for peace."
This is a little clearer. The term 'peace process' is just another phrase for 'perpetual war,' a war which, like an elephant in the dining room, isn't spoken of by its name but is instead called a 'disagreement.' Note that unlike an endless and inconclusive 'peace process' where people get continuously picked off by the side with the most hatred, while the other side is repeatedly forced to respond with pinpricks of 'meassured response,' to which the first side in turn responds claiming it is avenging the deaths of its martyrs- in open war, there is an END. Peace can be obtained with war, precisely because war knocks can sense into people, or can make one side moot.
It isn't pretty, but it WORKS.
It worked in Japan after World War 2 for example. It worked with Hitler's Germany. It worked between the US and Britain in our early years. The nonsense that war does not 'solve anything' is just that. Nonsense. It does solve some things.
It would be nice if people didn't have to resort to force to stay alive. It would be nice if a 'peaceful' solution was possible in every case.
But please tell me where Hitler would have compromised with Poland? tell me what room there was to compromise with his desire to kill EVERY Jew? The Jews and the Gypsies tried compromise. They permitted themselves to be shut up in ghettos. They permitted themselves to be loaded onto cattle cars to 'go to the country to work.' Their property became German property, their businesses became state owned. Some even tried to leave. But there was no compromise with that insatiable desire of evil men to kill and the unbelievable willingness of others to look the other way or even offer excuses for the murder- the Jews couldn't compromise enough to satisfy the Nazis.
The same thing goes for Stalin's victims, or for Red China's, or Pol Pot's. There was no compromise to be had.
So let's rephrase your statement for even more clarity:
"War causes enough grief so that the one or more sides decides that surrendering and living with the consequences is preferable to continuing the fight. "
If the palestinians succeed in getting everything they want, then there will be no Israel because it is Israel they want. Israel cannot compromise more than it already has compromised. They would be wise not to make that silly offer again.
But even if Israelis did, and willingly went off to exhile in America and left all of Israel in Arab hands, the palestinians' OTHER problems would become evident. The disappearance of Israel would not make Palestine into a wealthy or even functional free state. They would simply wage war on Christian arabs, or live in self imposed poverty. The war would solve what they thought was the problem, but the real problem would remain because they failed to deal with it.
But here is the rub... the palestinian leadership doesn't want a compromise anyway, of any kind. They aren't paid to compromise. They are paid to wage perpetual 'peace processes' with terrorism, to help outside nations distract their populations from the corruption they themselves live under. And now, the PA leadership is paid by Iraq to distract the United States from providing Saddam with eternal rest.
Saddam knows war can be very decisive. That's why he doesn't want to have to fight another with us. Arafat knows that REAL war can be decisive. That's why he always talks peace while waging war... to keep the 'peace process' going and the money coming in., and to save his own skin. So long as he is thought to be a 'part fo the process' he is remains in control and safe among his own population, and is untouchable by Israelis.