I'm not sure why you say that it would surprise me. How many settlements do you think is okay? And more importantly, how many projected settlements are okay, in your opinion?
No, Fatah did absolutely stop armed resistance. Getting wiped by Israel hasn't been a reason for Palestinians to stop fighting or laying down the arms before. Fatah stopped fighting, in part due to Israel's military victory, sure. But also because they chose to not further entrench themselves in insurgency. Hamas has been knocked out almost into oblivion, and still manages to fight, and according to what you said, they are even gaining ground in the West Bank.
And yeah, no go zones means that the PA doesn't go there because they are against Hamas, and afaik they don't fight Israel either. Sounds like they did chose the pacific route w.r.t Israel ?
Also, any terror attacks in the West Bank itself against Israelis is by definition an attack against settlers. Rockets aren't getting thrown from there, incursions into Israel are very rare, etc. And even those aren't done by organized groups (like the Fatah used to be), except for Hamas, and again Hamas is seen as an enemy by the Palestinian authorities there. The Fatah did win in the West Bank 20 years ago, against Hamas.
I'm not sure how you are arguing against my original point though. The West Bank authorities and the majority of the people living there aren't engaging in armed resistance against Israel. Groups who do are being treated as criminals and they work with Israel to fight them off. Israel in return keeps expanding their settlements (the scale doesn't matter, that's exactly what they have been doing, and Israel had been vocally pushing for the largest expansion in settlements ever, months before October 2023).