I'd like to reply to your first premise, "If God is all-loving, he would not have created hell."
In objecting to this conditional, I first want to define "hell" as the separation from the presence of God. Therefore, hell is not something
created but is rather merely the natural result of God removing his existence from a place. In the same way that darkness is not a material
thing, but is simply the absence of light, hell is not one of God's creations, but is just the absence of his presence.
Ok, but that still does not answer why an all-loving god would allow for the existence of hell. This is where I bring in, as Sam26 put it, the “tired free will argument.” Let’s start with what we’ve already assumed: an all-loving god.
If God is all-loving, then he wants what is best for every person.
What is best for other people is not hell.
Therefore, God does not want people to go to hell.
If God does not want people to go to hell, they either go to hell because they are acting outside of his control, or because he allows them to go to hell regardless of his wants.
God is all-powerful, so people do not act outside of his control.
Therefore, God must allow people to go to hell regardless of his wants.
This is where free-will comes into the argument. This is my basis for believing in free will:
As the Maximally Good Being, God deserves to be loved more than any other being in the universe.
So, God deserves to be loved by the people he created.
Because he is also omniscient, God knows that he deserves love, and therefore wants people to love him.
So, when he created people, God must have designed humankind with the capacity to love him.
Forced love is not love.
So, God cannot force humankind to love him.
Humankind must, therefore, be capable of freely choosing to love God.
To have the capacity of free choice is to possess free will.
Therefore, humankind must possess free will.
Because free will includes the capacity to choose to love God, it also includes the capacity to choose to
not love God. In the Judeo-Christian religion, to not love God is to sin, so people who do not love God are sinners. God cannot be in the presence of sinners, so those who do not love God cannot be in his presence.
Through this argument, we can see that God only had two options other than allowing for people to go to hell: (1) go against his nature, and be in the presence of sin, or (2) get rid of free will, and, by extension, the capacity for people to love God. God cannot act outside of his nature, so he could either destroy free will, or allow people to go to hell.
This is how an all-loving God can coexist with hell.