I guess this stuff is pretty much for the protection of the companies themselves. Israel was not shy about using force for it's protection in the past, and, fighting a continuous war ever since it was founded, I'm not surprised about it. I don't think they care about slaps in your or anybody else's faces when terrorists routinely blow themselves up in marketplaces and buses.

BTW I doubt Google would risk putting high-res imagery of Israel on the web even without rules preventing it.

Shalom!