Are you really sure about the cause-and-effect there?  The following factors, none of them nuclear, heavily contributed to the shift within the Arab-Israeli conflict over time from state vs. state to state vs. non-state actors:

1) Israel's overwhelming victory in 1967, which relegated its destruction by conventional Arab military action into the realm of permanent fantasy.

2) The increasing salience of the Palestinians as a separate issue from the Arab states vs. Israel conflict, which largely resulted from Israel occupying the West Bank and Gaza in '67.  Being more on their own than ever before, the Palestinians turned more to guerrilla and terrorist attacks instead of relying on the failed military power of the Arab states.

3) Sadat's decision to make peace, which removed the most powerful Arab state from the conflict and thus made a conventional attack by any of Israel's neighbors far less likely.

You could see the effects of 3), in particular, in Israel's invasion of Lebanon in '82.  Having safely concluded the peace treaty with Egypt, Menachem Begin felt he had a freer hand to launch a massive intervention into Lebanon, which would have been seen as a much riskier proposition when Egypt was either still poised to attack Israel, or engaged in negotiations towards peace.  And then the rise of Hezbollah shifted the overall Arab-Israeli conflict more into the state vs. non-state realm--that came from a combination of the instability of the Lebanese civil war, external support from the new Iranian regime, and the further destabilizing effects of the Israeli invasion.

But all of this has a lot more to do with Israel's huge superiority vis-a-vis its neighbors in the conventional realm than with its nukes.  I admit to knowing very little about nuclear weapons and their effect on international relations, but I know plenty about the Arab-Israeli conflict, and I think you guys are forgetting about a lot of things that have been far more significant than Israel's nuclear arsenal.

Let me add the example of what Saddam did in '81 vs what he did in '91.  Again, my overall point here is just that Israel's nukes were not the determining factor in what happened, in this particular state vs. state scenario.

After Israel bombed Osiraq in '81, Saddam had no direct recourse against them, partly because he had his hands full with fighting Iran, and partly because any Israel vs. Iraq confrontation would have resulted in him getting his butt kicked.  But in '91, he was able to bomb Israel at will without worrying about any repercussions--why?  Because the way the political situation was lining up, it made perfect sense for him to do so: he knew that it would increase his support with Arab populations, and that any direct Israeli response would put the other Arab governments in such an untenable position (fighting against another Arab state on the same side as both the U.S. AND Israel) that they might have to withdraw their support of Desert Storm.  So he had very little to lose, and potentially quite a lot to gain, from attacking Israel.  Their nuclear weapons didn't enter into it, aside from possibly being a factor in deterring him from attaching chemical weapons to the Scuds.  

Saddam was able to attack Israel in '91 because conventional retaliation would have been to his benefit, i.e. the nukes had little or nothing to do with it (though my word choice was bad, since firing Scuds from afar isn't the same as "bombing" someone).  And I did point out that the nuclear factor might have deterred Saddam from using any chem or bio weapons in those Scud attacks.

As you say, "no one fears Israel going for a land grab and no one wants to be nuked in a major combat situation if they go into Israel," but I don't think the nukes matter all that much here.  No neighboring Arab states have enough conventional power to cross Israel's borders in force, certainly not the pre-'67 boundaries.  So I don't see how Israel's nukes are supposed to be such a determining factor in changing how the conflict has been fought, i.e. more focused on irregular forces and non-state groups, or in affecting Israel's thinking on what it can or can't get away with.  Those are the arguments I disagree with. 

I would submit that Israel's neighbors have reduced their conventional warfare capability because of the nuclear imbalance - they recognize that they no longer have the ability or the backing of Russia to win in any form of conventional operation. So it becomes a circular argument - did Israel's nukes create the current lack of state-vs-state conventional attacks, or did the neighboring states willfully build up irregular capabilities as a conscious substitute for their lack of success in conventional attacks (which conveniently, nukes cannot deter)? Either way, Israel willfully projects its power any time/place it chooses.

Timendi causa est nescire - Ignorance is the cause of fear.