Neither is going to happen, at least I don't think. The sides are too far apart and there are those pesky religious differences.
Religious difference can be a key, what many are afraid to deal with should be dealt with most readiness and openly. Israel has a potential of motivating the religious solution, or some sort of secular reformation in the Arab world.
I don't see how? Would you mind elanborating on this please?
By being a leading player in the middle east, the one that has the most to offer.
By steadily developing one's own worth and building bridges with past enemies.
By organizing mediums for long - term direct exchange between leaders of local communities, including those with opposing and most critical voices.
By balancing liberalism with religious heritage.
To talk about theological aspects of the conflict would require a whole thread.
From my point of view, with real learned scholars of Islam, there can be reached more agreement on those issues, rather than with purely political attitude.
There's debate between Christianity, Judaism and Islam separately, but everyone is supposed to be afraid of an open discussion between Judaism and Islam. So we're especially obligated to engage in that exchange on a more vocal and clear level.
But basically there're 2 trends I'm referring to -. Israeli Jews are becoming more traditional while Arabs are becoming more secular. In my view the situation is reaching a new equilibrium in 2-3 generations when the ideological distance between the 2 civilizations is less apparent.
Secular Muslims have little say over the radical ones as I see it. Holocaust still fresh with many Jews, they will never give up their one Jewish state.