Answer

Hello Mosh.
As long as bodies are being held for the purpose of bargaining or for planting demoralization in the Israeli public in order to defeat it, there is nothing morally problematic about that at all (assuming there is no problem with their struggle itself). After all, it is no worse than killing people. Is holding bodies really more severe than murdering people (in war, in order to win)? The problem is that sometimes it seems they do not really want to bargain, but are simply abusing the families. And again, if the abuse were useful to their struggle, then I too would regard that conduct as legitimate (as stated, murder is no less severe than abuse), but there is a sense that this is being done merely in order to torment, not really to gain anything. See the case of Ron Arad, where no one even tried to bargain over the return of his body but simply made it disappear. And again, perhaps my assessment of them is mistaken, in which case everything is fine.
Ehud Barak once said that if he had been a young Palestinian, he too would have carried out attacks. Everyone got up to swallow him alive, but he was of course right (it happens. Even a stopped clock shows the correct time twice a day).
Obviously there is a great deal of hypocrisy in our attitude toward the Palestinians. That is the way of politics: speech is not meant to express content but to preach and conduct propaganda. True, usually the speakers themselves are not very intelligent, so they take their own statements seriously. This applies both to politicians and to the general public. People are not very smart. You can simply ignore it.

By the way, there is nothing explosive here. This is a normal and legitimate question. People who have no answers to it will tell you that you are insulting them, and that is how it becomes explosive. There are no explosive questions (that is just an expression meant to shut people up). There are good questions and less good ones. That is all.

One more comment. Because we are dealing with unintelligent people who see such a thing as immoral, the State of Israel actually does not use bodies in order to bargain and to win. Instead of never returning their bodies, or wrapping them in pigskin (to prevent them, according to their own view, from getting the World to Come) and burning them, the bodies are returned to them. Why do this foolish thing? Because to people it seems inhumane and abusive. But it is not. Using bodies in order to win is no worse than killing in order to win. And that, after all, we do indeed do.

By the way, while we are at it, I also oppose negotiations over the bodies of our soldiers, and I oppose risking the life of even one soldier in order to recover bodies for burial. There is no reason in the world to do that, even though the IDF in its foolishness does it all the time. It is simply absolute nonsense, rooted in the same folly we talked about. As though bodies were somehow more sacred than living people and using them were immoral. Nonsense.