A video, discovered on the cellphone of a paramedic who was found along with 14 other aid workers in a mass grave in Gaza in late March, shows that the ambulances and fire truck that they were traveling in were clearly marked and had their emergency signal lights on when Israeli troops hit them with a barrage of gunfire.
Israel is an ethnostate because they are deliberately ethnically homogenous and view Arabs as inferior on an institutional scale, not because of their state religion. A state with a religious ruling class is called a theocracy.
I see what you’re saying because religion has societal and cultural impacts that reinforce specific behaviours, but not all states that have a state religion are actually theocracies in the traditional sense.