Israeli governments have gone to lengths to distinguish Jerusalem from the West Bank and "illegal" from "authorized" settlements.

See earlier post on Jerusalem.

U.S. "sources" have purported reminded the Israeli government that its obfuscations and posturing won't deter U.S. policy.

"The United States views East Jerusalem as no different than an illegal West Bank outpost with regard to its demand for a freeze on settlement construction, American sources have informed both Israel and the Palestinian Authority.
"Later Sunday, Netanyahu met with his advisors to discuss Israel's response to Washington's demand."

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Netanyahu on Sunday, July 19, 2009

""I was surprised by the American demand," a source present at the meeting quoted him as saying. "In my conversation with [U.S. President Barack] Obama in Washington, I told him I could not accept any restrictions on our sovereignty in Jerusalem. I told him Jerusalem is not a settlement, and there is nothing to discuss about a freeze there."

"In my previous term [as premier], I built thousands of apartments in the Har Homa neighborhood of Jerusalem, defying the entire world," Netanyahu added. "Therefore, it is clear that I will not capitulate in this case - especially when we are talking about a mere 20 apartments.""

Added: An example (citing the reliably pliant WaPo) of how Israel's territorial distinctions about the land that it occupied in 1967 are exploited to validate its claims about East Jerusalem being distinct from the West Bank.

Prior posts on settlements.