How about the 100 Years War? I’m not enough of a historian to argue this, but the populations of England and France at the time were probably equivalent to Israel and Palestine (and its allies.)
astorian, here is a political map of Europe in 1600 A.D.
Here is a political map of Europe today.
When you compare the two, you should see dramatic evidence of countries that both separated and coalesced. Europe is at peace today. Somewhere between 1600 and today dozens of small homelands disappeared, some by war, some by alliance that solidified into a greater nationhood, but the common theme is overlapping claims to territory caused these nations to disappear and the borders to be realigned.
The people didn’t go away, but they did stop fighting over it, and while war was a necessary component, just as it is in Israel, military victory was only one component of the change. Another huge part of it was peaceful compromise.
If that’s not good enough for you, along with all the other relevant examples given above, then perhaps you should offer us the rest of the examples. You know, the ones where two parties claimed the same spot of land, one clearly won, and the other curled up in a ball and disappeared forever, never to trouble the winner again…
Depending on how you define “never to trouble the winner again”, I would submit your choice of Native American tribes… 
I guess it depends on whether you find casino gambling to be “troubling”
Franken’s book was Rush Limbaugh is a Big Fat Idiot, but it also contained satire against Newt Gingrich, Ollie North, Pat Robertson, and other then-prominent conservatives of the time.
For a book devoted exclusively to deflating Limbaugh’s numerous misquotes, gaffes, and nonsense, look for The way Things Aren’t: Rush Limbaugh’s Reign of Error, from FAIR. It’s a bit dated, but definitely makes its point.
astorian , you are still refusing to address the most relevant counter examples that have been presented.
Case 4 directly applies to:
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The Bosnian Civil War. Three ethnic groups lived intermixed for many centuries. After a bloody conflict in which no one could be said to have won a clear victory, a negotiated settlement was reached in which none of the parties satisfied their war aims (a unified Bosnian state for the Muslims and Croats, union with Serbia for the Serbs).
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South Africa. The Afrikaaners considered themselves to be as “native” as the Bantu groups in the region, since they contend that they moved in about the same time (post 1500s), both groups having displaced the Khoi-san. After years of bloody conflict, a negotiated settlement was reached.
Cyprus, as mentioned by others, could also be an example.
Here we witness astorian dodging the issue as he attempts to distort the actual question that was asked. This is not the premise of the statement as stated by DDG in the OP. There is nothing in there about “willingly” or “peacefully.” The premise, as I understand it, is that a settlement has to be reached by negotiation without either side winning a clear victory in a conflict, and for that there is ample precedent