Israel is a Jewish state and should remain that way (no right of return for the Palestinians) but there should also be a state of Palestine consisting of the West Bank and Gaza. The Israeli settlements within Palestine should either be removed or their inhabitants become Palestinian citizens. That is only right and the Palestinian sovereignty issue would be more workable.
This is what The Head Heeb says today:
But I'm not ashamed, and never will be, of supporting the withdrawal, opposing the settlement movement or demanding an end to the occupation. The settlers are not the only ones with moral rights, and both the future of Israel and the dignity and freedom of the Palestinians are in the balance. Neither of these can, or should, be cast aside for the settlers' sake. The settlements must go regardless of the pain, because far more pain will result if they don't.
Have I said that I love this guy? Anyway, read Jon's entire post because he makes the point much more eloquently than I could. He also has a far better grasp of the mindset in the region than I do.