The answer lies not only in annexation but in transfering the hostile Arabs to an Arab country (or countries), but it's actually against the law to suggest this in Israel (I believe).
The borders of 'Eretz Yisra'el are determined by Halakhah and not by human authority. Unfortunately the State of Israel that has existed since 1948 is a secular western democracy and not a Halakhic state.
For a lot of reasons, I disagree with Kahane. But if the annexation is unequivocal and emphatic, there will be less overtly hostile Arabs, and thus easier to transfer out those who are overtly hostile.
An emigration package could also be offered for those who leave voluntarily, similar to the immigration package offered to Jews who make aliya, and the government can buy up Arab real estate and protect those who sell or facilitate sales from reprisals, including one-way tickets to the country of their choice and new identities.
But every Arab emigrant family member would have to be interviewed separately to determine that they are not being held against their will, are not Jewish, and are leaving of their own volition together with the head of family.