Israel withdrew fully from Lebanon in 2000, and this was certified by the UN, yet Hezbollah kept attacking them anyway.

If Hezbollah offered Israel a choice between: peace with Hezbollah OR occupy land in Lebanon, I think Israel would rationally choose peace.

But Hezbollah has never offered this. Their stated goal is complete destruction of Israel.

So if the options are: Hezbollah shoots at you from right across the border OR you occupy a buffer zone and Hezbollah still shoots at you but from further away:

Isn't it perfectly rational to choose the buffer zone?