since abbas did not accept the offer, the palestinians now have start new negotiations with netanyahu. the palestinians have never accepted any peace plan offered to them. that is just a fact. there is no doubt that abbas had hoped that obama would impose a draconian settlement on israel. he had miscalculated. israel is not a bana republic. your claim about israeli coalition issues disregards the blaring fact that hamas rules gaza and would take over the west bank if not for the presence of the idf and help to pa from the u.s.
from the article: Haaretz exclusive: Olmert's plan for peace with the Palestinians