That is one usage of the term. The more common and liberal (and historic) terminology is precisely to make a multicultural state which is accommodating and or safe for Jewish people, which is closer to what Israel has been pre Netanyahu.

For what it's worth, I tend to agree that Israel is something like the original sin of the conceptual post war nation state. But again, that cat is not going back into that bag. My point is not that Israel is without sins, it is that anti-Zionism comes with a significant amount of linguistic baggage which more precise langue avoids. It is far more productive to articulate the specific behaviors of modern Israel which one finds unacceptable, rather than to dive into this specific linguistic battle.