All things considered Netanyahu's speech yesterday was as good as can be. I am personally much more right wing then Netanyahu and can in no way shape or form support any kind of Palestinian state, however, I realize that Netanyahu did what he had to do at this juncture.
I think that it was very important for him to give the historical perspective which is always missing.
It was also very important for him to insist on recognition of Israel as a Jewish state. As we can see from Mubarak's and others reactions this hit the nail on the head. They are so against recognizing Israel as a Jewish state because as a Jewish state we have a historical/religious claim on the land. However, if Israel is not a Jewish state then we are just colonialists stealing Palestinian land. It is critical that this come out in the open. The average person on the street in Israel is now being exposed to this and is coming to the realization that the Arabs simply don't want peace and will never accept Israel. The YNet article about this has a whopping 700+ comments already.