Please don’t swallow lazy journalism and sensationalist headlines. Israel’s projected building in E1 does NOT threaten the viability of an independent Palestinian state. (For example, see here.)
If you really want to help the Palestinians, don’t pamper to their sensitivities. Tell them the truth. For example, continuing incitement does more to harm the prospects of peace, than building houses.
And if you want to break the mould, and get to the desired end result, do what you can to get the Palestinians to restart direct negotiations. That is the only way there is a chance of an enduring solution.