when the peace negotiations between the PA and Israel made reference to two states side by side, it was clearly not a return of Palestinian refugees to the 1948 borders, especially when the population multiplied outside of Israel/Palestine in the millions over 6 decades, from originally up to half a million. If the refugees were to return to Jaffa and Safed, then the State of Israel would not be distinct anymore and there wouldn't be two independent sovereign nations side by side, as both peoples' origin stems from the Holy Land. That's what an eventual compromise entails - sharing the Holy Land to achieve peace for the region for predominantly those of Jewish, Muslim and Christian faiths.
First refugees travelling on Hungarian bus arrive at Austrian border (Reuters)
from the article: Right of return revisited