I think we can be pretty certain that this approach represents one of Israel's likely "next levels."
It would be much cheaper, and very much more effective, than a wholesale invasion of Palestinian areas. It wouldn't surprise me if the whereabouts of at least 80% of the PA and militia leadership was known at all times, and their locations targeted.
Tirawi is Arafat's right hand man. He is even closer to Arafat than the high profile Bargouti. Tirawi is holed up in the same office as Arafat...
The world is never going to look kindly on Sharon. He might as well be the man to clean up this mess any way he can.