To have a smaller but all-Jewish state might work. The trouble here is if this process keeps getting iterated till Jewish Israel is down to the size of a postage stamp. The other Islamic countries won’t take their brethren in any way that releases pressure from Israel. Maybe there is some way to force the existence of something like an “Islamic Liberia.” So we can say at least those people were put somewhere.
History has shown that an all Jewish State does not work well either. Simply trade unhappy Moslems for persecuted Christians in the Middle East while sowing peace between secular and religious, and at the same time increasing the Jewish birth rate while maintaining good relations as much as possible with most nations. Wait for Messiah.