Of course it wont go away, and 99% of Muslims know this and the 1% that dont, mostly use the "fact" as a political ploy.
Hey they would accept it if it was ever proposed. In fact they have... several times. But each time the Israelis have been the problem.
Of course they want that... well the huge majority. It is small minorities on both sides that are dictating the situation and hence peace is not possible. Fact is, that the ones that dont want peace at the moment is the Israeli government.. if they were even remotely serious about peace, then they would not constantly violate international law by expanding the illegal settlements.
There are minorities on both sides that know very well, as soon as peace is close, then this minority on both sides does something stupid.. terror attack, more settlements, settler violence and so on and that causes the talks to collapse.
You would be wrong. It is 50% on each side. You say they have an irrational hatred of Jews..... well you think about that.. Living under occupation, torture, murder, and someone stealing your land and so on.. think on how you would react, and how your cousins and family would react to such a treatment. I am not justifying terror in any way, I am just pointing out that it has not come out of a vacum, and neither has this so called "hating Jews" crap that is being thrown around by the pro-Israel side.