Listen.
With respect, a Palestinian homeland has never been the obstacle to regional peace. Rather, the stumbling block has been Arab recognition of a two-state solution that permits a Jewish state, of whatever size, to co-exist in the region.
The only way out of the cycle is the willingness in the Arab world to accept a two-state solution.
The Israelis accepted a two state solution in 1937 (Peel Commission Report) and 1948 (UN Partition). In both cases, the Arab states rejected it.
Although Israel left southern Lebanon and Gaza, it is currently fighting a two-front war against extremists who continue to reject a two-state solution, which would require compromises on both sides.
Hamas is clearly dedicated to Israel's anhiliation. Hezbollah, a proxy of Iran, is similarily so dedicated.
Israel is clearly under siege and is defending itself against groups dedicated to its destruction, groups that callously and strategically operate within civilian population centres.
The way out of the cycle of violence would be for Hamas and Hezbollah to accept a two-state solution, which will necessitate compromises on all sides, and to abandon their dedication to the destruction of the Jewish state.