Why should the Palestinians worry about Israel building houses and developing the area in the Westbank while their is a big chance that, if a peace agreement is reached, those neighbourhoods will fall under their authority? Israel evacuated all settlements in the Sinai and Gaza when it retreated. So I can't see how this is an obstacle to peace. Just seems another excuse for not doing anything about a peace agreement. Like I said it didn't stop Pali's before from negotiations. Final borders still have to be negotiated. Abbas recently also put in a second pre requirement for joining negotiations, that a peace agreement should be based on the pre-1967 armictice lines. The PA doesn't want to negotiate, but put their terms on the table with a take it or leave attitude, thats not how it works. And if a peace agreement is only acceptable with pre 1967 armicetice line, again why worry about new settlements??? In the mean time a peace agreement based on a two state solutions becomes further and further away. Then again, history has shown again and again that Palestinian Arabs are not really interested in having their own state. As stated by the PLO before and other Arab leaders, Pali nationalism is a tactic to combat Israel.
So, under the new Netanyahu government only one terrorist master mind was killed during a raid, during which Israeli's tried to capture him alive, but due to resistance it turned out in a gun fight. I fail to see how this contitutes a continuous policy targetted killings and is a obstacle to peace.