It goes back to the war aims of 1948, driving the Jews westward basically westwards into the Med. Now the likes of Trans Jordan never envisaged a Palestinian State, it was more about expanding their own territory. As they did until 1968 and of course Egypt did with Gaza.
This is and has been since the fall of the Ottoman Empire a multi layered issue, just look at all the rivalries, Iran vs Iraq, Iran vs Saudi, Monarchies vs Theocracies, I always think of Saudi as being the most religious but they are under attack from dissenters who consider them sell outs, and then you have Iran's internal pressures as well and Egypt that relies on money from Gulf states, Sunni vs Shia and so it goes on.
Pakistan has been kicking out hundreds of thousands of Afghans but nobody seems bothered about that.
And then there is the big one, Water.
If Israel vapourised not a lot would change. Just different issues.