Hamas has offered to return the hostages many times and Israel refuses to stop the killing. Missing in your analysis is Israel’s primary goal: ethnically cleanse all of Palestine and enforce Jewish supremacy.
Offering and doing are different. Unilaterally returning the hostages is the winning move for Palestinians. It is not for Hamas’ leadership, however, so it won’t happen.
> Missing in your analysis is Israel’s primary goal: ethnically cleanse all of Palestine and enforce Jewish supremacy
This is like equating hard liners with Iran or Hamas with Palestine.
There are elements in Israel who want this. There are elements without who are okay with it. Nobody is particularly motivated to intervene because the burden is purely moral—there isn’t a unique industry or diaspora for Palestinians to call on.
Hamas and Likud benefit from the war continuing. (Their right wing elements are both exterminationist. They have been for years. Nothing new there.)
My guess is that Netanyahu would say that the war can't end until "all the terrorists are dead" (impossible), and the Palestinians have given up the one bit of leverage that they have.
The international terms of the debate would change. The domestic political situation in Israel would change.
Netanyahu’s hand would be significantly weakened by losing hostages as a justification to his electorate and even the IDF. Hamas, however, would face pointed questions over why it didn’t recognise that the hostages were a liability sooner (I frankly question if they were ever an asset at all—Sinwar’s purpose, to draw in Iran, was a dud).
If you want to get conspiratorial, consider that the one red line Netanyahu has respected is Hamas’ leadership’s security in Doha.