The fight is not about a state for Palestinians. It never was about a state for Palestinians. Giving the Palestinians a state will not bring peace. It will only make it easier to make war on Israel. The West Bank so called was originally part of Jordan. They lost it in the 1967 war. Israel is not giving it back. Gaza was a heavily Arab town and area which was demarcated in 1949 and governed by Egypt until the 1967 war. Israel occupied it then but never wanted it. That’s why they gave it back. I believe the whole mess is basically insoluble by diplomacy and whatever comes of the present conflict, this dilemma will ultimately not end well.
Actually the West Bank and Gaza were the remnant of what, according to the UN partition plan, was suppose to be the Arab half of a divided Palestine. After the Israeli War of Independence the West Bank was administered by Jordan but never incorporated into the kingdom. But the point, though, is that there is a Arab population living in the West Bank that is not going to go away. Israel has two choices, either annex it and grant citizenship to the Arabs, or surrender it to the Arabs living there as an independent country.
I know that both options would be hard on Israel but the continued unresolved occupation is not sustainable. It only radicalized the Arab population more. Notice that this radicalization is not happening with the Israeli Arabs, nor with the Jordanians and Egyptians. It has been more than 50 years since Israel captured the territories. It is time for a final settlement: either two separated states for the Jews and the Arabs (the original UN partition plan) or one for both populations.