It is absurd that we are blaming Hamas for not digging tunnels to accomodate 2 million people instead of blaming those who flattened dozens of residential blocks, and bombed schools and hospitals.
I'm pretty sure Israel did not bomb hospitals. Maybe schools. Flattened residential blocks certainly, after warning civilians to evacuate. Mosques were bombed.
Both schools and hospitals lose any protection they might enjoy under the Geneva convention if they're used for military purposes. Israel doesn't really benefit from bombing a school that isn't used in a fight against it, quite the opposite, Israel is losing support by doing that. At the same time Hamas gains an advantage by using these facilities because it grants him immunity. It's really not that complicated to understand.
Israel does benefit from flattening residential areas because it's taking out cover for Hamas. The rubble blocks tunnel entrances. Booby traps and mines will detonate. It's tactically removing an advantage from Hamas who would prefer to fight in the built up areas at close quarters. In war you don't want to get into symmetric fights, you want to use your overwhelming strengths to neutralize any advantage of the enemy. It's not like he's got a knife I'll bring a knife, it's more like he's got a knife, I'm gonna drop a bomb on the building he's in from an F-16 and then shell it with artillery and then have some tanks fire at him for good measure and then run him over with the tanks. There's also an element of deterrence (to the Palestinians but also to other actors) by inflicting a lot of damage.
In terms of the Hamas, martyrdom is a core value, so number of martyrs isn't a factor, especially if it's not the billionaire in Qatar being the martyr. "Jihad is its path and death for the sake of Allah is the loftiest of its wishes,β. Hamas wins when more Palestinians are dead. The things "we" value in the "west" like well being, prosperity, peace, empathy, whatnot are not factors. We're talking about the same Hamas that recruited and sent hundreds of people into Israel to blow themselves up with random strangers in the early 2000's. They won't only not protect people, they'll get them to blow themselves up or engage in suicidal missions (which was one possible outcome of the Oct 7th attack, that a much larger portion of the attacking force would get killed and the damage inflicted would be much smaller).
Given that Hamas is also a political and social organization, which at least once had broad support from Gazan citizens in free elections, I think stating that "Hamas cares nothing about "its" citizens." sounds suspect. Would citizens vote for organization that doesn't care about them at all?
https://www.indiatoday.in/world/story/tunnels-built-to-prote...
Honestly your question shows great naivety. Even in the west people continuously vote for politicians that couldn't care less about them. In less developed countries let's just say it's much worse.
Want to know how well public air-raid bunkers work against advanced bombing technology? Check: https://en.wikipedia.org/wiki/Amiriyah_shelter_bombing and that's 30 year old tech.
This question is one of the talking points of the Pro-Israel side. It's not that bizarre. But yeah, as talking points go, it's shallow/simplistic. The idea is to demonstrate that Hamas couldn't care less about Palestinian lives. They don't invest in any shape or form in protecting the citizenry or making the lives of Palestinians better. It's also meant to contrast with how Israel invests in protecting its population- lots of shelters for a much larger population, Israel has been building shelters in various forms forever. During most of the cold war Israel has been facing enemies with fairly unlimited resources as well, rockets, ballistic missiles, large air forces, even artillery (the north of Israel used to be regularly shelled by Syria way back). So it is actually possible to use shelters as a layer of defense.
Israel's more recent strategy of reinforced spaces in every house/apartment (started IIRC when Saddam Hussein decide to lob Scud missiles at Israel) has worked fairly well so that could be replicated in Gaza. Israeli buildings have taken direct hits by rockets from Lebanon and Gaza with pretty decent survival rates even when the building itself was practically demolished. Though that might require using the concrete for something else than tunnels. Oh no, another talking point.
The better strategy though is not to get into a situation where you're being attacked with bunker busters or try to separate civilian infrastructure from military infrastructure. Other ideas is that when you're warned about an area becoming a subject to aerial bombardments you move away. Sorry, more talking points.