I think a peace deal involving referendums in these areas (not under military occupation-creates unfair and unfree conditions for a referendum e.g., as in Crimea!) would identify the actual will of the people in these parts of the Donbas.
Ukraine had even better terms than that under the Minsk agreements. They refused to hold to the terms and stop shelling Donbas, even after they signed a ceasefire twice. After the invasion there was another attempt at peace talks, it ended with Ukraine dragging their own negotiator into the street and shooting him in the head. Late last year Zelensky signed a decree making it illegal to negotiate peace with Putin. The few times Ukraine has retaken a major area they immediately begin purging "collaborators and traitors". If Russia pulled back it's military Ukraine would just immediately invade those areas, regardless of any agreements they signed.
I'm not philosophically opposed to your idea, it really would be the best outcome. It's just impossible to actually implement.