It is a very complex issue and as you say when someones reference point is from God then it is hard to have a logical discussion!
Israel should issue an ultimatum to the Arab world and tell primarily Egypt to take control of Gaza and primarily Jordan to take control of the West Bank. They should give them 6 months to sort out law and order in those areas, and get them to accept that Jews will live in the middle east and recognize the state of Israel. If the Arab world cannot achieve this then Israel should go in and annex the territories and give the people a choice of to take Israel citizenship or leave the country. Brutal but better than the slow strangulation of these areas.
Obviously it would have been better to have got the original decisions correct but they didn't and without a drastic solution this will continue on and on.
The Mentalist - given it was WW2 I assume your knowledge of the Balfour Declaration and the British Mandate are very limited. People want to view the Israel was simply formed after WW2 but if you can be bothered to read history then it goes back much further. I have little time for either side but it is interesting to see the current media swing behind the Arabs in Gaza.