It's not an ethnostate either. There's 2 million muslim arab people living in Israel with full citizenship and all the rights that go with it--including the right to vote in democratic elections. It's no more an ethnostate than, say, France or Germany.

Agreed.

But, to be fair, there is some validity to the idea that it's an ethnostate, in that there is automatic "right of return" only to ethnic Jews. Not to mention there is some legal discrimination against non-Jews (like the new nation-state law) and also a whole lot of non-legal discrimination.

I don't agree with this reasoning - but the situation is complicated so I understand why some people argue otherwise. Like you, I'd say that Israel is just like France - it defined some group of people to be citizens (or the equivalent of "expat" citizens), which included all Jews in the world, and also included the non-Jews on the land at the time. And from then on, acted like any other state. This is very similar to France/Germany/anyone (and Zionism was started as part of the same worldwide move towards nationalism).