The world does not recognize Israel's position on Jerusalem, by a majority of 193 to 1. The majority of states recognize The State of Palestine by a majority of 130 to 63. If you want a debate about WP:Undue, you'd lose on that score alone, since, as I noted, the current opening line gives undue weight to a fringe position. Still, we're here not to quarrel, but to find a sensible arrangement for an inadequate lead.  I'm happy to withdraw my qualifiers if the current majority prefers the text as Evansh2008 and Tiamut tailored it, by the way. Since the SoP is a state occupied by Israel, arguments of the kind you are adducing do not apply. We do not underwrite power arrangements here, we simply state what the best sources agree is the case, which here, is that Jerusalem is not wholly in Israel, is occupied, and the occupied Palestinian part is more or less left to its own resources in managing the mess in its quarter. Since the article deals with all of the city, there's no way of equivocating over this, and trying to maintain NPOV while relegating the Palestinian fact to a footnote.