RAMALLAH, West Bank ? A U.S. envoy met with Yasser Arafat on Monday, but made no headway in trying to resolve the key dispute holding up cease-fire talks standoffs between Israeli troops and wanted men in the Palestinian leader’s West Bank headquarters and Bethlehem’s Church of the Nativity.

Elsewhere in Ramallah, a gruesome scene was played out in a downtown square: at least three masked men fired assault rifles at three alleged informers, in front of scores of bystanders. The crowd quickly grew and watched the wounded men writhing on the ground. The three were eventually taken to a hospital where one later died.

In other violence, five Palestinians were killed by Israeli fire in three separate incidents in the West Bank and Gaza Strip, including a school teacher Palestinian witnesses said was hit by random Israeli tank fire. In Bethlehem, Israeli forces and armed Palestinians holed up inside the Church of the Nativity exchanged gunfire.

The U.S. envoy, State Department official William Burns, met with Arafat for about two hours at the Palestinian leader’s compound in Ramallah. Arafat and about 300 aides, security guards and foreign volunteers have been confined to several rooms by Israeli troop since March 29.

Netta Golan, an Israeli-Canadian activist in the compound, said that while Burns was holding talks with Arafat, an Israeli bulldozer crushed several cars parked outside and began building a rampart near one of the walls. She said Burns came out to see what was going on before resuming the meeting.

Key issues in the Burns-Arafat talks were the standoffs in Ramallah and Bethlehem, truce prospects and humanitarian assistance to the Palestinians, according to Palestinian and U.S. officials.

The Palestinians say they will not begin truce talks until Israel has left all Palestinian-run areas in the West Bank. On Sunday, Israel wound down its three-week military offensive, completing its withdrawal from Nablus, the West Bank’s largest city in line with a timetable given last week to visiting Secretary of State Colin Powell. However, Israel says it will only lift the blockades in Ramallah and Bethlehem once wanted gunmen holed up in the two compounds surrender.

Soldiers remained in Bethlehem and parts of Ramallah on Monday, and maintained tight blockades around the other West Bank towns. Israeli officials say troops will re-enter Palestinian cities without hesitation if terror attacks resume, and on Monday soldiers carried out several arrest raids in Palestinian villages.

Arafat and Burns made no progress in resolving the two standoffs, said Palestinian Cabinet Minister Saed Erekat.

Arafat told the U.S. envoy the Israeli pullback was merely cosmetic, Erekat said. “President Arafat stressed the need to lift the siege from the Church of the Nativity and his office,” Erekat said.

Israel demands that Arafat hand over five suspects in the assassination of an Israeli Cabinet minister in October, as well as the alleged mastermind of a large shipment of Iranian arms to the Palestinian Authority intercepted by Israel. Arafat has refused to give up the six, who Israel says are in the Ramallah compound.

In Arafat’s headquarters, speculation was running high that Israeli forces would try to break in and snatch the wanted men. Palestinian officials, speaking on condition of anonymity, said Powell last week refused to give Arafat a guarantee that Israeli troops would not seize the fugitives.

Israeli military commentator Alex Fishman appeared to confirm the Palestinian apprehensions, writing that “as of last week, various government spokesmen have begun to scatter hints about an upcoming infiltration of the compound, the removal of Arafat, sending him away and capturing wanted men.”

Israeli officials close to Prime Minister Ariel Sharon said, however, that the government was carefully weighing the regional implications if army commandos were to storm Arafat’s refuge.

Palestinian Information Minister Yasser Abed Rabbo accused Israel of following a hidden agenda to destroy the Palestinian Authority and kill Arafat, a claim that has been denied by the Israeli government.

Abed Rabbo said Israeli troops wantonly destroyed government ministries during the three-week occupation of Ramallah and seized large amounts of records, including vehicle registration files and medical records.

Elsewhere in Ramallah, masked men pulled three alleged Palestinian collaborators from a car in a downtown square and shot them. Shouting to bystanders before fleeing the scene, the gunmen said they were from the Al Aqsa Martyrs’ Brigade, a militia linked to Arafat’s Fatah movement, and blamed the three men they shot for Israel’s capture of Fatah chief Marwan Barghouti last week.

In the Ramallah suburb of Beituniya, the West Bank security chief, Jibril Rajoub, on Monday gave reporters a tour of his headquarters, trashed by Israeli troops during the offensive.

Rajoub, considered a moderate, said he would not resume security coordination with Israel. Such coordination is a key element of U.S.-backed plans for bringing about a truce and guiding the sides back to peace talks. “The Israelis have succeeded in creating a sea of blood and hatred” with their offensive, Rajoub said.

At the United Nations, Secretary-General Kofi Annan appointed a three-member U.N. fact-finding team led by former Finnish President Minister Martti Ahtisaari to visit the Jenin refugee camp to learn what happened there during Israel’s military assault.

Arab nations have accused Israel of killing civilians in the Jenin camp, but Israel says the deaths and destruction there resulted from gunbattles between its soldiers and Palestinian gunmen. The fighting in Jenin was the fiercest of Israel’s three-week military offensive.

The U.N. Security Council voted unanimously Friday to back the fact-finding mission. The vote came after Israeli Foreign Minister Shimon Peres told Annan that Israel would welcome a U.N. representative “to clarify the facts” of what happened in the Jenin refugee camp.

In Bethlehem, Israeli forces and armed Palestinians holed up inside the Church of the Nativity exchanged gunfire Monday, as the 3-week-old standoff at one of Christianity’s holiest sites appeared far from resolution.

Stun grenades were heard around the church, and a puff of white smoke rose up from the compound. A Palestinian policeman inside the church, speaking on condition of anonymity, said Israeli fire was hitting the church walls.

The Israeli army would not immediately comment on the situation.

Other policemen inside the church said they returned Israeli gunfire, and that some of the smoke outside was wafting into the church. Israeli soldiers also were leaning ladders against compound walls, they said.

The army has leaned up ladders before to throw in leaflets urging surrender and to allow people interested in leaving the church to get out. On Sunday, five people used the ladders to get out. Two of them were civilians, two were Palestinian police and one was a member of Arafat’s guard.

Three weeks ago, armed Palestinians fleeing Israeli troops shot open the locks of a nearby Franciscan monastery, and broke into the church compound. Since then, Israeli tanks and snipers have surrounded the compound. The church stands on a grotto where Christians believe Jesus was born.

The army says armed Palestinians number about 230 and include some militants wanted for killing Israeli civilians or soldiers. There are also 35 priests, monks and nuns and about 50 unarmed Palestinian civilians, some of them teen-agers.