Judging by how things go here in the US when the glowies “let things happen” (ie the FBI not investigating numerous mass shooters and the 9/11 hijackers when they should have), I wouldn’t be surprised if they had intended to let it happen to consolidate more power for themselves.
People in intel agencies are all sociopaths and they likely see this as an opportunity to get more funding and autonomy. The deep state never wastes its chances to seize more power. Additionally: the far right government in power can use it as a distraction and push the “reforms” they want when no one is looking and push out more Palestinians and take their land. The settlers always need new places to take over, and tens of thousands of dead or displaced Palestinians is a great opportunity. Plus if you look at the civilian casualties for the Palestinians, the IDF is showing 0 restraint and leveling whole blocks with 0 regard for the people who have nothing to do with Hamas.