I agree, but if something can't go on forever, it won't. I am struggling to see how this ends. What is the most likely outcome and alternatives?

Strait opening and sanctions lifted? Why would Trump agree?
Strait opening and sanctions not lifted? why would Iran agree?
Ground invasion?
Stays closed indefinitely?

I think "strait opening and sanctions not lifted" is the most likely outcome - but nothing as clean as that.

Ground invasion is the very least likely. There's zero appetite for Iraq 2.0 here in the U.S., and Iran's vastly bigger than Iraq. It's probably a red line for Trump's base - and given how few red lines his base has, that's really saying something. Trump doesn't have the money for that kind of operation, and he's not going to get it from this Congress.

Stays closed indefinitely is also not very likely. It's just too painful for everyone. You'd trigger a global recession, cause crippling shortages throughout Asia and some of Europe, and cause a lot of misery in the U.S. and other countries with very high petrol uses. It would be catastrophic for the other Gulf States. And that's just the oil - there's plenty of other goods that are also held up, like gas and fertilizer and helium. But most importantly, it's not Iran's ideal outcome, either. They'd prefer the Strait be open than closed. The Strait can't stay closed forever, so it won't.

So the Strait opens, with or without sanctions being lifted. It's important to remember that neither is a binary: the Strait can open in degrees, sanctions could be partially lifted, assets can get partially unfrozen, etc. I think you're right that Trump wouldn't agree to lifting all or most sanctions just to get the Strait opened, even though that's (obviously) Iran's best case scenario. But Iran probably knows that, too. If the Strait reopens in material part, it won't be with Iran getting released from sanctions altogether.

I think the more likely outcome is probably some messy, sloppy muddled tenuous arrangement. The U.S. and Iran start by letting some traffic go through - perhaps even without even admitting they're doing it much, or as just "shows of good faith" presumably in furtherance of talks, when they're ready for that to happen. Enough to calm markets and provide some relief, but not a final deal that blasts the Strait open for both sides, at first. And then that expands by degrees.