Technically, “Palestine” is the geographical name of the region, and has nothing to do with ethnicity or religion, whereas “Israel” was the historical Jewish nation and is the specific Jewish state in the area. If things were named sensibly, everybody there would be considered a Palestinian, and “Israeli Arabs” would be understood as referring to Mizrahi Jews.
Technically, “Palestine” is the geographical name of the region, and has nothing to do with ethnicity or religion, whereas “Israel” was the historical Jewish nation and is the specific Jewish state in the area. If things were named sensibly, everybody there would be considered a Palestinian, and “Israeli Arabs” would be understood as referring to Mizrahi Jews.
You have a very peculiar understanding of words.