I think really what the Western Countries seek is less neutral and more friendly Ukraine towards western interests and a move away from Russia.
Basically, they'd like another Poland or Baltic states, friendly, open for NATO bases and EU business.
Naturally Russia would like the same but in reverse (or, like you say, a neutral Ukraine which would probably be the best compromise in this situation, but how do you guarantee neutrality in a country which is split between pro-western ideology and pro-Russian ideology?)
There may come a compromise on this, down the road, if IS hadn't reared its ugly head I might have said that Russia leaving Assad out to dry might have been one possible compromise in order to let the US turn a blind eye to Crimea, but that card is off the table now really since Assad is no longer in the cross-hairs and is actually, through a roundabout way, helping the US deal with IS.
Right now though, there's blustering and maneuvering on both sides to draw the maximum amount of prestige out of this situation that they can.
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