As far as international law is concerned Israel should revert to its pre-'67 boundaries, and the US and Britain should have be putting pressure on them to do so for decades.  Practically I think the solution wil have to be the pre-67 boundaries with land swaps, but from a purely moral standpoint, I think that the control of the occupied territories should revert to the Palestinians who should have the right to tell Israelis living in the the occupied territories to leave.  I also think, morally, that the Israelis should pay the Palestinians massive compensation.

A two state agreement with the pre-'67 boundaries and agreed land swaps, while it might be the best that is achievable, will almost certainly be massively in favour of the Israelis, because it will be an agreement between the powerful and the powerless, and will  therefore be one where the Palestinian people will tend to get the worst land and a poor deal.  Might is right will once again be seen to be the truth of the matter.  But at least it would be something.