The objective here is to encourage the other side to lay down its arms. That happens when there is clearly no possibility of victory. If everybody on the one side dies, there is nobody from that side to declare victory, is there? Last man standing declares victory by default.
There are only three options. Either the Israelis cut off every head the hydra presents, they emigrate en masse or they continue to allow their children and wives to be blown to bits.
I think we are operating from different assumptions. I take the Palestinians at their word when they said in the Palestinian Charter that their goal is the destruction of Israle. Whether they removed those words or not doesn't matter, that is and will continue to be the goal.
Of course, I'm not a diplomat and my first instinct has always been to hit back but thats my opinion for what its worth.