Recent reports have indicated that the way U.S. and Israel might be able to reach agreement on settlement freeze is by excluding East Jerusalem in such a freeze, among other things. But it's not clear whether that will fly:

Egypt's foreign minister says East Jerusalem must be included in a freeze of Israeli settlement activity before Middle East peace talks can restart.

Ahmed Aboul-Gheit told reporters in Stockholm on Friday that Jerusalem is Arab "and it will continue to be so."

He said the Arab world expects the area to be included in a moratorium on Israeli settlements.

Bear in mind that even an agreement about settlements, with perhaps some Arab reciprocation (although the Arabs say they don't want a piecemeal process) would only get talks started--only then does the real work begin. Especially considering that only 4 percent of Israelis now believe Obama is on their side.