What does the covenant of peace have to do with the literal nation of Israel just before the coming of Christ.
ALL of the promises under the OLD COVENANT were CONDITIONAL UPON OBEDIENCE. They were NOT obedient. They committed great sin. God punished them by having Babylon destroy Jerusalem and take many of them captive. He then gave them 490 years to atone for their sins and accept Christ as the Messiah. Their final act of rebellion was the stoning of Stephen. The nation of Israel, corporate Israel, is now dead to Christ. INDIVIDUAL Jews are a completely different story.
Since Paul says only those Jews who accept Christ will be grafted back onto the root, “all Israel” here can only mean all those who are regenerate in Christ. Which is the exact definition of the Church.