When Lord Krishna, in his role as the ambassador of the Pandavas, reaches Hastinapur to ask the Kaurava king to return the part of the kingdom that justly belongs to the Pandavas, it all comes down to getting the proposal accepted by Duryodhana, for the king and all the rational members of his council are powerless. For a second, during the exchange of talks, Krishna even transcends the boundaries of fairness, as mortals understand it, to avoid mass destruction and makes a charming offer to Duryodhana: “You can keep the entire kingdom and allot only five villages; your father has to take care of the Pandavas as well.” While making this promise, Krishna knows that the Pandavas are in his refuge and will happily accept whatever he brings home for them. Krishna does his part in promoting peace and in demonstrating that the Divine gives at least a single chance for self-improvement to even the unrighteous. (This is similar to Lord Hanuman’s lecture to Ravana during his first visit to Lanka in the Ramayana.)
From the perspective of the unethical camp, this is an event where the Lord is offering a big chance — a chance that a shrewd opportunist should never let go of. Duryodhana can keep the kingdom that never belonged to him, happily survive with his immoral brothers and friends, and forget the Pandavas without having to pay for his misdeeds, especially in the same lifetime. In spite of everything, Duryodhana rejects the proposal. The Kauravas fail not only in following dharma but also in identifying their own material profits in Krishna’s final offer.
Why could Duryodhana not accept a proposal laden with material profits? Because he had never learned to receive; he had only developed a habit to seize objects from the truthful. Unless faith in God is present, the jiva cannot pick up anything from the universe, be it goodness or profits, except for negative energy. Unless one cultivates the higher modes of nature (sattva-rajas) within, one will ignore forgiveness and gifts from even the Divine himself and offend him.** This is exactly what Duryodhana does. And Krishna sees the moment as an arena to show his divine form (vishwarupa) to the ones who loved him.
** Highlighting such human tendencies and circulating solutions to them are a part of an incarnation’s divine plan. Krishna later dictates the general theory on why a jiva like Duryodhana can never accept a peace proposal in the Bhagavad Gita.