The couple definitely look Mediterrenean: French, Spanish, Portuguese. But what about Israeli? I've met a lot of young Israelis with similar builds, and facial features.
All Jewish and Druze Israeli men are required to serve in the IDF (arabs, both Moslem and Christian can volunteer, but outside of Bedouins, this is rare).
Anyways, it is fairly common for Israeli men to go on long vacations once they complete their service. This can include back packing around India, Africa and Asia, hitch hiking etc. So, the manner in which the couple was found could indicate a vacationing Israeli serviceman after his mandatory service.
At the same time, the Israelis also have a mandatory reserve system. That system was probably very rigidly enforced in the 1970s. Thus, if he did not return to Israel and report to his reserve unit, I think that he would have been missed quickly. My guess is that somebody would have went by his family to see what his vacation plans were and also to inquire if he emigrated and was thus no longer living in Israel (name then removed from reservist list).
So, I think it is less likely that he would be Israeli. I would suggest that the couple could be Roma / Gypsy as they tend to have Mediterranean looks, but the expensive dental work would seem to make this less likely. Then again, I imagine that not all gypsies are poor and some my come into money quickly- maybe spend it catching up on dental work?
Since the couple was not robbed, maybe they were killed as part of an internal gypsy feud? My understanding though is that while feuds between gypsies do occur (usually over what family or clan can or cannot operate traditional gypsy businesses both legal and illegal as well as fortune telling places in city "X", deadly violence amongst Gypsies is rare, but cant be ruled out.