It would not surprise me if the Israel cabinet is dealing with pressure to go all out and clean out the Gaza rat’s nest of Hamas in full. Israel has that power to do so.
Israel would want to severely reduce their capabilities - but what Israel does NOT want to do is destroy all semblance of government - or else Israel is forced to actually come in there itself, and supply the “civilian government” on its own. Israel wants to leave enough structure so that it is still self-governing and does not require Israel to come in, itself.
SO ... Israel will try to severely degrade the “terrorist capacity” without destroying infrastructure that is needed. The real problem is that Hamas is the terrorist organization — AND — they are the government at the same time.