Forgive me, but you're post here is just too wrong in too many levels to let it past like this.
First off, people are not downplaying Israel and jews. They're just taking into account actual politics and marketing décisions. And Firaxis won't certainly add Israel in order to not lose the arab market, just as they won't add Tibet so that they won't lose the chinese market.
Second, we must not mix Jews and Israel, as bound together as they are. We either are talking about the jews, which are a religion, or israel which is a state (in the broad sense of the term). Many jews may have won Nobel prizes, but were they more regarded for their religion, or for their nation ? Did people consider Nadine Gordimer as a jew or a South african ? Do people consider Henri Bergson more jew, or french (I can garantee you it is the latter) ? You simply can't say can't say jew = israeli. Even about the money, you should realize that the Rockefeller family is more american than israeli, like Rothschild has its family in many places, but not in Israel.
Also, surviving a genocide is hardly a criterium to be in Civilization. With that, I could say that we should add a Hutu civilization (which wouldn't make much sense, of course). Now the fact of maintaining somewhat their cultural identity is more a criterium just like the tenacity you spoke of !
There is a human race, composed of many ethnicities. Please avoid saying "jewish race".
Finally, there are 2 Israels : a modern nation and an ancient kingdom, both having their problems. Modern Israel, as I said earlier, is too much controversial (and very young also), due to its conflict with Palestine and its apartheid policies. Again, adding it would cause too much trouble between the fan communities or even the marketing departments with high risks of banning the game in arab countries.
And on ancient Israel, it was an insignificant kingdom historically Wise. Its importance simply comes from biblical accounts, and even its greatest Kings are legendary figures which we do not know if they ever existed.