Perhaps the best way to deal with this problem is to utilize the same approach in dealing with the Palestinians in the West Bank. 1) Set up roadblocks and checkpoints limiting movement of all settlers throughout the area. 2) Treat those who commit the Price-Tag attacks as terrorist and detain them in prison for long times and judge them in military courts. Of course one needs political heftiness to carry out these policies, but they will work as well as the treatment of the Palestinians.
Pakistan: Suicide bomber attacks tribal police, killing 4 (Reuters)
from the article: Netanyahu: 'Price tag' attacks put a stain on all of Israel