I think that's a very good way of looking at it. They may not be Jews any more, having mostly converted to a religion that didn't exist 2,000 years ago, but Egyptians are still the people of the Pharaohs despite now being majority Muslim. They still see that as part of their heritage.
Gramsci has linked before on this thread to quotes from figures in Zionist movements of the 20s and 30s who wanted to make common cause with Palestinians. I think my question now would be to ask: is that aspiration still a viable one? Can a Jewish homeland be reimagined as somewhere that is inclusive rather than exclusive, for all the people who call the area home, regardless of their current religion or cultural traditions? (Particularly the case, perhaps, given that different groups of Jewish Israelis themselves have very different cultural traditions.)
In my angrier moments over the last few months, I have thought that from a Palestinian perspective, why shouldn't they think that the Israelis should fuck off back where they came from? Why should Europe's crimes be their problem? But you're right, of course, that that is a non-starter. In which case, the question becomes: how to make amends?