Ironically enough it was exactly this in the other direction which caused the problem in the first place.
Indeed. Although I do agree that having a place to call "my country" is important and the situation of Jews pre-Israel didn't really do that (they were isolated groups that often did not feel attached to a place they lived in), the way Israel was established was downright bone-headed. In order to give Jews a homeland, they took it away from people who already lived there. Then they reduced the natives to second class citizens.
Despite being, for a long time, in the exact same situation themselves. Go figure. This is why Israel ticks me off so much. Jews are the ones who, of all people on Earth, should know better.
This whole idea that the Israel-Palestine conflict has its roots in some ancient religious clash is nonsense, anyway (and very flattering to the Western powers that actually started it). Its causes are an entirely secular affair, namely that people tend to get touchy at each other when they both want the same things.
It doesn't have
roots in a religious clash, especially not an ancient one (by the time Muhammad came around Jews were already a minority in the region). But it's religious and ethnic rhetoric which makes it so hard to resolve. It's not entirely about politics, either. A large part of the problem is that Israel is a Jewish state and thus favors Jews (both in ethnic and religious sense), discriminating against Muslims, Arabs and especially Muslim Arabs, who constitute most of the local population. Of course, this does not sit well with them. If Israel was a secular country which the Arabs could also call "their own", the conflict wouldn't be as bad, with the separatists likely reduced to hardline fanatics. However, the way it is now, Arabs in Israel are treated like second-class citizens and the government itself proudly pronounces itself as "Jewish" and sidelines its own Arab population and their culture. Is there any wonder they want a place of their own? Or, more specifically, they want to get back the place that was their own before a bunch of foreigners moved in and took it as theirs.
They don't fight over anything that couldn't, in theory, be shared. The problem is, neither side wants to share. And I get a nagging feeling that they, in fact, want to keep up fight. Resolving this conflict would be easy if we were dealing with pure realpolitik, but we aren't. Indeed, the article in the OP clearly states many ways in which Palestinians failed at realpolitik (and Israeli have their share of that, too).