Key points to remember:
1. The PLO was formed in 1966, before the 1967 war. What part of Palestine do they want to liberate? Not the west bank and Gaza they weren't in Jewish hands at that point.
2. The Arabs did not recognize the 1948 partition seen below.
3. In 1948 Egypt, Syria, Transjordan, Lebanon, Yemen, Saudi Arabia and Iraq all declared war, or invaded Israel. A state of war still exists between all these countries and Israel with the exception of Egypt and Jordan which have signed peace agreements. Additionally Iraq never signed an armistice in 1949 as the others did. Any military action by these powers and Israel (such as Iraqis SCUD attacks) are not new 'acts of war' but continuing acts in an on going war that started in 1948. So Israelis attack on Iraq's nuclear power plant in the 80's was a legitimate military action.
4. Israel armed the Palestinian Authority.
5. Terrorism is using terror against noncombatants in order to get the populace to change a political position out of fear or desire to end violence. (Blow up bus demand release of prisoner, people scared of bombs ask government to release prisoner) When Palestinians blow up tanks or attack checkpoints that's an act of war not terrorism. When Israelis blow up a PA building that's not terrorism. PLO throwing rocks at tanks, not terrorism, PLO throwing rocks at Jews because they are pissed, not terrorism (assault). Throwing rocks at Jews to get the government to pull out of west bank is terrorism.
6. From the Golan heights one can shell Damascus or Galilee.
Look, the Palestinians are not rock throwing children. They are armed soldiers
Israel believes in overwhelming force. Arrest with tanks. Attacks police stations with choppers.
   
   

OK heres something that always made me curious.. The map the the left is the UN 1948 partition. Note that there are chunks of purple (Arab) in the north and in the south (beyond the Gaza strip which is only along the coast. Why doesn't anyone refer to them as 'occupied territories"? Why do they not show up on any map?
Those territories where conquered by Israel in 48-49. The armistice agreement gave them to Israel. Clearly all parties agree that either side can possess territory conquered in war. So what's the big deal about the 'west bank'?
Also note from this map the narrow strips of land connecting each sides three parts. An enemy can easily cut your country into thirds and use the divide and conquer plan to beat you. This, along with the fact that Israel is only 50 miles wide, makes it easy to understand why Israel is so paranoid.


1948 - War of Independence.
Israel secures new territory after being invaded by Arab states. Map
1956 - 1956 War
Israel violates armistice as France and Britain join her to retake the Suez from Egypt. UN status quo ante-bellum Map
1967 - Six Day War, 1967 War.
As Arab forces mobilize on border Israel launches brilliant preemptive strikes (how rude) Takes Sinai from Egypt and Golan Heights from Syria. Jordan attacks and loses West Bank all in 6 days. Map more
1973 - Yom Kippur War or 1973 War.
Arabs attack on Jewish Holy Day. Did well but Israeli counter attack recovers lost ground. No change in territory. Israel loses allot of men. Map more
1982 - Invasion of Lebanon.
Israel invades Lebanon in order to create a buffer zone against PLO rocket attacking Israel. Following normal operating procedure she takes the capital and forces the PLO out the the country. Syrian enters Lebanon to 'help'. Israel withdraws to south and eventually pulls out. Syria still there controlling a puppet state.

 
The US Military Academy has excellent maps available on line which show the conflict.
BBC has a ceries of simple maps on the conflict
  
     



click
click
The quasi-goverment authority that runs a few places in Israel. Be prepared for some propaganda.
Arab League Declaration on the Invasion of Palestine 1948
BBC on the conflict
BBC Timeline
Click
   
Official Israeli Government Site
Israeli National Photo Collection
    
IDF Site
Israel responds to claims (IDF)
Info on Arms ship (IDF)
Info on the Kassam II rocket (IDF)