I think the rule of adverse possession would tend to favor the Palestinians. The Jews may have been there over 2000 years ago, but how is that relevant now? Did "God" give them the land? Who's "God"? The Palestinian "God"? Did anyone ask for their input? Who tortured the Jews in the 1930's and 40's? Germany, right? Why not give them a section of Germany? What about the other groups tortured by Hitler? Why don't they get their own country?
Even the Bible says the Jews weren't the original inhabitants of the land. "God" gave them that land after they left Egypt, or so they say. Did you know there is no archaeological evidence for the Exodus? It never happened.
As far as Europeans occupying North America first, there is no evidence of that. There is evidence that they came and left, or quickly died out. This land belonged to Native Americans. We took it by conquest. Right or wrong, mostly wrong, but we conquered this land. Israel was handed their land by the U.S. and her international puppets. Why? There have been victims of genocide before and since. Where are their countries?
Now, I know Israel is not going anywhere, just like the Native Americans will never get the Black Hills back, even though it is theirs by treaty. I just don't think it is reasonable to expect the Middle East to joyously accept another US attempt to tell them how, and where, they are supposed to live.
The violence on both sides must stop. The Palestinians need to accept the fact they were screwed. The Israelis and the U.S. need to understand we screwed them. Only then will peace talks have any chance of success.