I don't have much I can say that will make this a lengthy answer, but the answer likely has something to do with population statistics.

Imagine two states, both with 100 people.

In state A, each year, 5 people are born, and 1 person dies.

In state B, each year, 3 people are born, and 1 person dies.

Even ignoring the exponential growth factor of birth rates, by 10 years in, state A has had 50 births and 10 deaths. It now has 140 people.

In state B, 30 births and 10 deaths. It now has 120 people.

Because state A has an overall larger young population, 1 death out of 140 people is a lower death rate than 1 death out of 120 people.

This is the primary distinction. Crude death has to be balanced against the fact that the Palestinian population has long been overwhelmingly younger than the Israeli population. This, coupled with the fact that Palestinian living conditions (while worse than Israel's) increased from 1967-1983 especially, and indeed even beyond that they have still continued to increase in some areas albeit more slowly (life expectancy, for example, has gone up from 68 years in 1990 to 71 in 2000, while in Israel it went from ~76.6 to ~79.9), means that the number of deaths is smaller as a percentage of the population. Younger populations tend to have smaller death rates.

This also explains why Japan, a much "older" country, has had an increasing death rate since around 1980, when the population began graying significantly, and it has even gone up other countries similarly as they get "older". Less births means higher death rates as the population's growth starts to slow, or it contracts, and since Palestinians have a very high birth rate and death in the conflict is actually relatively low, that changes how the statistic exists.