One Israel considers legitimate or one that Israel is confident actually has effective control of the population and any agreement will thus be honored?
I think Israel faces both problems and the additional obstacle that a formal peace with Israel, depending on its terms, may even erode the credibility of a Palestinian faction among its population and therefore undermine any meaningful control it may have had over the population.

I'm unsure why you say that political sovereignty erodes as a result of the pervasiveness of western norms? I'd also suggest that your "read: criminalization of non-Western regimes" linkage does not seem to apply universally.
I should have spoken with more clarity and developed my line of thought more fully. Western norms are relatively more focused on human security, or at least, those kinds of norms have a higher profile and greater sensitivity in the West. The norms are specifically concerned with human rights, free market principles, and democratic governance. States which act in contradiction to those norms are not simply discredited, but criminalized to the extent that their political sovereignity is less measured by traditional means and increasingly more measured by those Western norms. Consequently, I think there's an "anything goes" attitude in regards to those states, akin to "Indian Country". This is not to say that states do not routinely undermine and challenge one other's sovereignity, but that the West is actively undermining the legitimacy of states in ways which I think prohibit effective diplomacy, and to a lesser extent, warfighting.

As an aside, I disagree with Paul Van Riper and would suggest that in the case of Iraq, the contributing factor to the initiation of the insurgency was not the absence of a formal surrender but rather the fact that the Iraqis did not believe they had been defeated -- not the same thing at all.
I agree for the most part with your assessment. I certainly do not think a proclamation of surrender would have prevented an insurgency from forming, but I do think it would have inhibited it to some degree dependent on which Iraqi authority announced a formal surrender and which Iraqi factions were loyal to said authority. Then again, with Saddam elluding capture for some time, it may not have been possible to attain or create a "legitimate" Iraqi leader to announce a surrender.