I think the whole situation is madness. I mean, the guy is dead, who gives a crap? If he wants to be buried in Jerusalem, let the guy be buried in Jerusalem. I personally think Arafat was little more than a terrorist, but really, who gives a crap? A dead terrorist is still dead. A dead king is still dead. A dead peasant is still dead. Dead is dead. Let 'im be buried where he wants.
Yes, the Jews were in the area of Israel a long time ago. Yes, the Romans kicked them out. Yes, the Palestinians moved in. Yes, the Jews returned to Israel. But really, why can't both parties live there? The way I see it, this a super-mutated and convoluted version of the "Old West Cowboys and Indians" thing in the US.
Really, I would say no outside force should get involved with the dispute, except Israel has nukes, and that's not a risk anyone should be willing to take.
Basically, the whole damn thing is one gigantic mess.