I would do it like this: All Palestinians would be offered a very substantial cash grant and guaranteed business loans at zero interest to establish a productive industry based on agriculture, mining, and services. This would be established through less than a few billion a year, over a 10 year program. Those who aren't so tied to the land by religious and ethnic reasons would mostly take the option and find themselves living an excellent life compared to before, with very generous, easily repayable loans as well as cash grants to help them establish themselves in a well developed but underpopulated country with much untapped resources, and Jordan would greatly benefit from the humongous influx of capital.
From there, those who don't want to go would have to sign non-citizen workers permits, which is not much different than any other non-citizen work program worldwide. Those who refuse to sign get deported, like how Egypt deports Sudanese refugees. Those who agree for Israeli work-permits would be allotted residence in any Palestinian-authorized residence, like how Saudi Arabia only allows foreigners to live in such compounds, but they would be very nice, on a level on par with the nicer Jewish settlements.
An international UN fund could also be applied to generate a few extra billion, maybe take some money from some useless UN bureaucracy and spend it on development of the Palestinian industry within these allotted zones.
I think with this system, the great bulk would go to Jordan and those who stayed would be allotted basically "Reservation" status except far better than the average Native American reservation, complete with guaranteed business loans and industrial development.
In this way, the Israeli demographics wouldn't feel as much pressure, as I believe the grand majority of Palestinian families would much rather prefer such a deal than their otherwise living conditions especially under their own Palestinian political authorities who are among the most corrupt in the world.
That's another issue, how do we deal with the corrupt PA, who is ranked as among the far worst of the public authorities when it comes to misuse of funds and cronyism?