Read your own post again, and note the discrepancies. You are wrong in several respects: A Catholic, who decides to become an atheist, is no longer a Catholic, because Catholics are not an ethnic grouping. Jews who become agnostic or atheists, however, are still Jews because that is their ethnicity! And they don't have to believe in any religion to become Israeli citizens.
Because besides being a religion Jews are a Nation and Israel is the national home.
It would be the same as if an ethnic Pole who is an atheist moved to Poland and sought Polish citizenship.
But your problem is not with Jews in Israel, is it? It's with dual citizenship American Jews in the US. And we are very few in number.
Want to know the only way being a dual citizen is manifested in my life. Unlike most every other American Jew, if I travel to Israel, it is more expensive for me. Israel charges me VAT taxes on hotels and car rentals.