I don't think that Israel operates like that, by the very nature of the state. It is "apartheid".
I am very unhappy about the treatment of the Palestinian people.
That said, I don't think the apartheid comparison flies. For one, Gaza and the West Bank are militarily occupied territories as a result of several wars where Israel was attacked by its neighbors, whereas the South African policy of apartheid was to allocate areas of lower quality land for reasons of racist segregation. One of the most obvious characteristics of apartheid was the racist views of "race purity" that underlpinned apartheid in South Africa. Israel is about as ethnically diverse as it gets, and its official policies, as much as I disapprove, are not motivated by racism. I see nationalism, but not racism.
And unfortunately, Israel isn't the only state who is being cruel to the palestinian people. Egypt is making it every bit as hard for the inhabitants of Gaza to cross the border as Israel does. This in no way diminishes Israel's responsibility in my eyes, but I think it is important to remember that none of the neighbor states, historically, and today, "want" the Palestinians either. For the longest time, the Palestinans were treated as pawns by the Arab states.
Most Muslims believe that Israel has an agenda that does not include living side-by-side in peace with Muslims.
Is that a genuine religious article of faith, or more like "Most Christians believe that the UK has an agenda that does not include Catholics and Protestants living side by side in peace in northern Ireland"?
I think to get a more complete view of the situation, the agenda of Hamas needs to be mentioned too, as they certainly don't believe in living peacefullg side-by-side with Israel.