No, Israel doesn’t send gays back to Gaza or to the PA territories.
Despite being “illegal aliens”, they now even get temporary work permits:

https://www.timesofisrael.com/israel-to-allow-lgbt-palestinians-granted-asylum-to-work

Palestinians facing LGBTQ discrimination to receive special work visas
https://www.jpost.com/israel-news/article-709948

Nor does Israel repress or murder gays living in Israel.

I think that would be considered a lot “better”, no?

Israel and Arab Countries Are Miles Apart on LGBT Rights
https://www.outwordmagazine.com/inside-outword/glbt-news/1239-israel-and-arab-countries-are-miles-apart-on-lgbt-rights

Other threads on RJ:

Jerusalem Pride March

Over 170K march in Tel Aviv Pride Parade (2022)

Only in Israel: Arab MK: LGBTQ rights are human rights, Arab community evolving

Palestinian activists ban ‘LGBT party’ [event] in Ramallah