* Israel isn't subject to Iranian jurisdiction, so it can't be "illegal", at least not meaningfully. In other words, if we don't account for jurisdiction then any international conflict could be considered "terrorism", which doesn't pass a common sense test.
* The Oxford definition stipulates "and intimidation", not "or intimidation". There's no indication that the aggressor's intent was to intimidate (rather, if they wanted to intimidate, they would have attacked the target's family or otherwise not been so surgical).
It's always a question of perspective.
Regarding your second point, there is obviously a part of intimidation in doing something like that. It's even mentioned explicitly off the record in the article:
"But some American officials argued that the death of Mr. Fakhrizadeh, the latest in a string of such mysterious killings of Iran’s top nuclear scientists, would send a chilling message to the country’s other top scientists working on that program: If we can get him, we can get you, too."
'Terrorism' is a term always used against others, the bad guys. We are the good guys we never do that. Some people have bought this line so much that it's difficult to accept that everyone does terrorism to a varying degree, at least certainly from the perspective of those on the receiving end.
What kind of logic is that? By then logic is it legal for Russian mercenaries to break into your house?
It's illegal in the same way 9/11 was illegal - purposefully targetting civillians is a breach of international law, and, of laws and customs of war. It is not onyl about laws of the host country where attack happens.
The argument that he was warking on a military project could apply if there was an official declaration of war, but that isn't the case.
The nature of sovereignty is that sovereign jurisdiction has only those territorial limits that the sovereign chooses; extraterritorial jurisdiction in law is common as is it's practical exercise.
More to the point, Israeli agents acting on Iranian territory are subject to Iranian jurisdiction without extraterritorial jurisdiction entering the picture.
> any international conflict could be considered "terrorism"
The proper crime is “aggression”, and, yes, almost every international conflict involves that on at least one side. (You can construct artificial scenarios where there is a plausible argument that both sides are exercising legitimate response to an apparent imminent threat, but they don't tend to arise in reality.)
> But some American officials argued that the death of Mr. Fakhrizadeh, the latest in a string of such mysterious killings of Iran’s top nuclear scientists, would send a chilling message to the country’s other top scientists working on that program: If we can get him, we can get you, too.
the unlawful use of violence and intimidation, especially against civilians, in the pursuit of political aims.
From Iran's perspective this is terrorism. From the US/Israel's that is probably not simply because I believe that there's probably a lawful mechanism for these governments to carry out this sort of action on foreign soil. For them it's "raison d'Etat".