Unfortunately, I believe the path to peace in the ME will eventually fill the oceans with the blood of many more dead than we have yet seen. The biggest foolishness of modern ME diplomacy is to assume there are moderates who will come to the bargaining table from BOTH sides. While both have their militant crazies, only the Israelis have made any real proposals for peace.
IMO, this mess began with the UN, and is one of it's first failures. If you look at the UN website, they have maps of the original UN mandates on how Israel would be established. Never a more disjointed and ill-designed piece of international folly was ever designed-no continuous borders, enclaves of Arabs right in the middle of Jew areas, ect. and so forth.
While I have no idea what the solution is-it isn't a economically non-viable entity such as the Palestinian "State", I doubt the fence will solve anything.
Thanks for the post, take care.