Seems to me like just a clickbaity headline. The article reads more like they're simply stating they'd rather not participate than change the song, whether anyone cares about their participation or not.
Israel has a song with veiled references to the October 7th Hamas attack, Eurovision has a very strict policy on zero political implications in performed songs, Israel says that if the song isn't performed, then they cannot compete.
Not that they will not or do not want to or are starting a boycott, just that if their song is not approved, they won't replace it and therefore cannot compete.
It's abit more complicated. Russia wasnt banned from participating in the Song Contest itself. Rather, the EBU has suspended the Russian broadcasters' memberships because of finding them spread propaganda. Which automatically means they cant participate.
In the case of Israel, if theh want to look into suspending Kan they need to find evidence that the broadcaster is not holding up to the standards of public broadcasting. And EBU hasn't done so in the cases of Turkey's TRT, Azerbaijan's broadcasters and similar cases where the country clearly has been committing war crimes recently.
You're not allowed, they were attacked first and they're Jewish. But they should really stop with the scorched earth tactics, if that's what's actually happening - I don't know what reports to believe.
I don't think Israel actually wants to compete this year, tbh. We all know the vote ain't gonna be pretty. Don't think the Eurovision organisation want them to compete either, too much controversy, but they don't want the fallout from actually banning them.
So the EBC will be strict on their conditions, while still claiming not to have banned them, and Israel can get to withdraw out of principle. Win win.
And that's assuming they make it through the semis, I'm thinking there'll probably be a lot of tactical voting in that semi-final to try and keep them down and disqualified. And with this even that might be uncertain.