Remember that HAMAS is strongest in Gaza, it was there that HAMAS started a civil war against Arafat last year forcing him to return from overseas to quell it. Many PA "police" stations were burned, and Arafat closed Gaza to reporters while he "cleaned up" his little problem.
My guess is this is both buying time for the US to position itself against Iraq, and making it easier for Hamas to attack the vastly weakened Palestinian Authority. Hamas is in open warfare with the PA in Lebanon over the refugee camps up there.
If Israel pulls out, leaving the streets un controlled, Hamas will attack Arafat. Arafat is trapped in Ramallah, the West Bank. His empire is crumbling from within.
The Palestinians are very predictable, Israel is allowing them to do to themselves what Israel cannot do to them. Hamas knows every PA operator and visa versa. Israel has taken out the control rods of this reactor by removing the upper management of both Hamas and the PA. Now the pack is turning on themselves and there is no one to reign them in. I think the IDF is guessing that Gaza is going to erupt into a big turf war. Arafat's top terrorists are going to have to smuggle themselves into Gaza to help hold the turf. The PA’s terrorist army will extradite itself into Gaza so Israel will not have to. This will perform a great mop up of the West Bank. More and more the terrorists are becoming concentrated into Gaza and the West Bank is becoming free.
Despite the rhetoric, I suspect most of the West Bank Arabs are pretty happy about this. Every one I have talked to behind closed doors hate Arafat but are deathly afraid of him and his secret police.