Something that just occurred to me.
Fantasy mode engaged.
Hamas have dug and built, reportedly, a few hundreds kilometers of tunnels.
The distance between Erez crossing to the suburbs of hebron is ~40KM.
With the concrete, materials, time and money hamas spent building offensive and rocket stashing tunnels, Israel and the PA could have built at least a 4 lanes tunnel to connect the west bank and Gaza.
Since such a tunnel would be a few dozes meteres below ground and completely monitored by cameras, they couldn't use the tunnel itself to endanger israelis directly. since israel could place checkpoints on the tunnel entrance and exit, it would be even harder to smuggle weapons through that tunnel between the West bank and Gaza than doing so above ground and israel would have far better knowledge of who goes where and when. Such a tunnel would also go below very little population centers and cross important roads in less than 5 points. this would have allowed the west bank and gaza to connect, without endangering israelis and hence, without israel getting terrified for letting free flow of people between the west bank and gaza on israeli ground. (There's still the problem of terrorists going unarmed to the west bank, arming themselves there and going on an offensive operation. this would mean israel would have to retract to a coherent border that is protected like the gazan border.)
While not ideal, i believe this could be a win-win situation. such a tunnel would keep israel safe while still allow palestines free travel between their two regions. obviously, we need to get rid of hamas to do so and there's probably lots of problems with rivers, topology and such that i haven't thought of. such a tunnel would not even come close to being the world's longest tunnel, so i believe its doable.
Israel and the PA could just build a train (I believe hamas spent money would not have been enough for that though) to ship people and cargo and that would even further lower the risks for israel.
The funding for a future project like this (Since hamas already spent his Aid money on war) could be loaned from Qatar and repaid by the PA with the funds they charge for crossing the tunnel.