F6 - you pretty much have summed up dispassionately the facts on the ground as it truly exists. Be prepared for the stone throwers (pun intended). The Palestinians in general do have to give up on the right of return and the Hamas and others of that ilk do need to recognize Israel's right to exist. Israel on the other hand does need to let go of parts if Jerusalem and withdraw from most of the settlements it has built in the West Bank to cement their facts on the ground.
Both parties need to compromise. The Palestinians cannot because they are being used by the Arabs. The Israelis will not because of the unqualified US support driven in part by right-wing religious republicans who see biblical promised land. I am surprised that Obama went as far as he did - and that too in this election cycle.