I do not think the two of you diverge by all that much.

This or that patch of dirt is required for the purposes of international law -- that is the way the game is played. A physical territory is required, but it is only one element of this game. Having this one element does not guarantee success. It doesn't guarantee you anything at all. A sovereign entity consists of a people as well, and a people that
behaves as if it were sovereign. In order to achieve any recognition in the games of states on the international field, this people must, of course, have their very own patch of dirt. But that patch of dirt is not going to secure itself.
People like to imagine national borders as permanent, obvious things. Often enough, they consist of rivers and coastlines. Still, neither the Mississippi or the Rhine have been national borders for a very long time. The coasts of the Mediterranean were hardly sufficient to keep France on it's side of that permanent, obvious line. It is people who give national borders their reality. Without the will of people, all these borders dissolve into the imaginary phantasms that they really are. Yes, in a national sense, you really do need to point to some patch of dirt and say "this is where we are; this is what we own." I should think, however, that it is manifestly obvious that it is also necessary for some people (ours, for example) to say "this is who we are."
I have encountered two dominant lines of thinking on this point in recent years. The most common one is a simple rejection of that statement. We cannot say "this is who we are" because it is not true -- we are, so it is said, no different than anyone else. We are not entitled to govern ourselves on any patch of dirt because, quite simply, we do not exist. The second line of reasoning is somewhat less common: do do not dare say "this is who we are." On the contrary, we must intone that we are all one. We have potent enemies, you see -- enemies that would immediately move against us were we to say something so audacious as "this is who we are." Apparently, the only hope for the Gay people is to persuade the straight people that there are no Gay people. The straight people, it is imagined, would not destroy their own. There is no basis in reality for either of these propositions. I am left speculating that they are delusions arising out of some widespread neurosis.
The foundation of the state is its people, not its dirt. I might argue that the existence of the state does not extend
beyond its people. Still, the world is a physical place and one can always make some attempt at defining the territory of a people -- it is, after all, where they are. More to the point, it's where their government is. Sovereignty is not, in the end, some present that foreign governments bestow upon you; it's the way a people behaves.
The opinions of others -- other peoples, other governments -- are not without weight. History has demonstrated fairly conclusively that this or that patch of basalt covered with dirt is diagnostic of a sovereign state. It is a prerequisite for the game. This is an arguable point -- certainly China and Japan have been arguing over just what constitutes "real" land in recent years. It seems that deliberately growing coral reefs to the point that they constitute islands and not reefs does
not qualify as acquiring new territory -- or so argue the Chinese. The Japanese have a different view of the matter. In the end, it will be people playing word games that decides the point, not the physical reality of the islands in question. The world is defined by others' perceptions just as much as it is by our own.
Yes, indeed... so far as international law is concerned, we really
do need some patch of dirt to call our very own. The effect of that patch of dirt on the psyches of our own people will probably surprise some -- for myself, I think it would hardly be possible to overestimate the impact of such an event. One can, to be sure, sail off and find some patch of dirt and declare it to be one's very own. One can then attempt to form some semblance of a people around that territorial entity. This was the basis of the plan for Alpine County. It was the basis of the plan for Heaven as well. "If you build it, they will come." An example from the straight experience of such things would be the island of Minerva... an example that ended with guys with guns and diplomats with papers. Or one can do it the other way around -- build up a people... then claim whatever territory their shadow happens to fall on.
Act sovereign,
be sovereign, rather than simply
claiming to be.