And then they used it to one up everything the world has seen in that region in recent past.
Oct. 7 was not only the most deadly day for Jews since the holocaust, it was also the most deadly day for Zionists since the conception of Zionism. Whatever Israel did after Oct. 7 was not to protect Jews, but to protect Zionism. The very same ideology which has stripped Palestinians of their civil rights. And because Zionism is a foundational ideology of Israel, I would expect them to behave exactly the way they did. But I also see Zionism as a fundamentally immoral ideology which should not be a policy of any state. So from a human rights perspective, the right thing for Israel to do since Oct. 7 (as well as much earlier) was to admit defeat, grant Palestinians civil rights (including the right of return and reparations for past wrongs), and abandon Zionism as a policy. Later they could file criminal charges, or have a special tribunal punishing the perpetrators of oct. 7, maybe even as a part of a peace treaty which also grants Palestinians civil rights.
I am not naïve, and I know Israel was never going to do that. That is where international laws should have kicked in which were supposed to pressure Israel into doing the right thing, by doing stuff like sanctions and boycotts. International law, however, failed spectacularly.
EDIT: to prevent misunderstanding, when I say Zionism I mean the belief that Israel should be a Jewish supremacy state on Palestinian lands, like I explained here https://news.ycombinator.com/item?id=44718838
There are no civil rights in Gaza, but that's not because of Israel - that's because Hamas is a fundamental, radical and totalitarian Muslim organization which is right next to ISIS in their methods and beliefs.
The suggestion that Jews admit defeat, hand their heads to Hamas and the likes and ask for forgiveness does not resonate as sane. It's like suggesting a rape victim to move in with the family of the perpetrator and look for reconciliation. The Palestinian and Jewish populations are not compatible with each other and I see no path to coexistence under the same governing body. These populations are too far apart on any conceivable metric.
Luckily Israel took the opportunity to do just about the opposite of what you suggested and aggressively dismantled the Iranian ring of fire that surrounded it. Lebanon and Syria have been transformed, Iran caught a massive blow and any dreams of breaking Israel by force must be a distant past now. The Middle East will have to accept Israel, and by the looks of things this is where it's going. If you haven't been to the region you'll never understand the collective Middle Eastern mentality that despises weakness and worships victors.