The two state offer was refused by the pallies in 1996, when it was offered to them. Bill Clinton brokered the offer, discovering the pallies don’t want their own state.
It has been refused at least since 1948 - actually well before then. But in 1948 Israel declared independence and fought off the invading Arab armies. In Khartoum in 1967, the Arab League met and issued the “three noes” statement. No peace with Israel, no recognition of Israel, no negotiations with Israel. Several more wars followed.
Now Israel has some peace deals. So some things change. For other people, some things stay the same. Hamas is obviously self destructive, caring more about this old pan-Islamic and Pan-Arabist ideology more than they care about the future of the Palestinian people. They would sacrifice generations today to achieve their ideological goals in the future. Hamas is a dangerous cult.
Both Arafat and Abbas got death threats from “their own people” after they proposed a 2 state solution.