Jerusalem as "corpus separatum" was part of the UN's original Partition Plan for Palestine, which Israel accepted. OTOH, the Palestinians didn't accept the partition plan.
There were no “Palestinians” back then either. Just Arabs, who adopted the false moniker later.
I don’t understand the separation of Jerusalem from Israel. Jerusalem is inseparable from Israel ideologically. When you think of that small area, the Bible whose pages are thousands of years old, it’s just strange to think of some of those places not in Israel’s borders. Joseph’s tomb? It’s just weird the disconnect with the historical reality of the region.