While the "realists" in Egypt and Jordan may have given up the idea of erasing Israel by 1973, NONE of the "Palestinian" organizations from the PLO down were willing to accept the two-state solution. Even now some of the organizations are willing to talk about a two-state solutions, others are only talking about the eventual elimination of Israel. Even Fatah, which discusses the two-state solution insists on the "right of return" which functionally means the end of Israel as those who left Israel in 1948, any who left the West Bank in 1967 and all their descendants who return to Israel and they, plus the resident citizen Arabs in Israel plus those on the West Bank would markedly outnumber the Jews in the Palestine of Israel, West Bank, and Gaza combined and even with a completely honest and above board election finis Israel - followed by dispossession of the Jews(1). Even those countries which have treaties today with Israel give at least lip service to the "right of return", thus tacitly endorsing the concept of the Jewish state going away. (2)
(1) The general policy of the Palestinian political groups is that Jews who came to Palestine after WWI, when it became a British Mandate, are illegtimate "colonialists" and the only Jews who have a legitimate place in Palestine are those who can trace their residency to pre-1918.
(2) The best estimate is that approximately 800,000 Arab inhabitants of Mandatory Palestine left the area that became the 1948 boundaries of Israel. Within 5-10 years after 1948 approximately 1 million Jews were expelled or "encouraged" to leave Arab/Muslim countries, generally with only a suitcase or two. Thus we had a population exchange (although not all Jews from Arab countries went to Israel). Compare this to the Muslim/Hindu population exchange at the same time between India and Pakistan, and the outright expulsion of ethnic Germans from Poland, the Sudentenland, and various Baltic states in the wake of WWII (these are only the most obvious examples).