It's largely meaningless in practical terms. Although most of the Israelis would disagree, in the long term it could actually be a modest advantage for them diplomatically with the rest of the world (Besides the US, which is more or less committed to backing them no matter what they do, for reasons that are unique to the US) because it would free them of the paradox of being an occupying power for the past 45 years, which has been an awkward problem morally and politically given their own original demand for self-determination, self-determination being one of the cornerstones of the UN Charter. They would have to clearly include territory as Israel or exclude it as separate sovereign territory instead of trying to play both ends of the court.