There are two concepts that are easy to confuse. I will try to separate them. Imagine that two sons are dividing a farm when their father left no will. One sort-of-fair way to do it is to give them IOUs based on the value of the farm, and then auction the various parts and items. They each get what they value most. One son says "The farmhouse is mine. I'm living in it, I've fixed it the way I want, it's mine. We can auction everything else fairly." Very different if he says "I want the farmhouse! I'll outbid you on that no matter what!" When Israel says they get all of Jerusalem etc they're talking the first way. Like it isn't part of the deal. Very very different if they say they want it and they'll negotiate for it. PA might give up East Jerusalem. But if they ask "How much is it worth to you" and you say "No deal, it's mine! Now we talk about how much of the West Bank I get" what result would you expect?
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from the article: Peres blames Netanyahu for breaching Jerusalem status quo