With the rest of the world experiencing their own rather catastrophic situations, attention, and therefore any outside forces of restraint, will virtually disappear. The West Bank and Gaza would be depopulated, with the people expelled over the nearest border without regard for what they may face (desert, radiation, bandits, etc) - leaving these areas alone would mean tying up military resources just to keep the status quo, all while the occupants build strength and continue launching rockets, sabotage, etc, etc, etc.
It wouldn't be pretty, but without the world media paying attention, it will be fairly quick - I estimate as little as a few months if the Israeli's go all out and their neighbours are unable to do anything about it.
300 years later(a DAMN long time) in 2300, all may well be forgiven, or perhaps there's simmering unrest and hatred just below the surface? For examples look at relations between nations today and what they were back in 1700. France and Britain. Britain and Spain.
Or how about Japan and the USA just 50 years after WWII.
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If it moves, shoot it, if not push it, if it still doesn't move, use explosives.
Nothing happens in isolation - it's called "the butterfly effect"
Mors ante pudorem
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