Britain wrongly assested the situation. Peace was not important for Germany.
Hitler didn't want to settle for anything less than conquering at least Eastern Europe.
War for Nazis was the both the mean to achieve his goal, and a goal in itself.
German problems after defeat in WW1, and recession of 30' were covered by hatred towards Jews, Slaves or other minorities, and pangermanic propaganda. War was an important part in Nazi ideology.
Germany was willing to go "all in (to war)", while Britian was afraid to raise the stakes (and Hitler knew it).
