It is Google's responsibility to provide a non-politically fueled interpretation of territories and locations on a map. By replacing Palestine with Israel,
Google is showing it's support for one specific side in a very heated religious and political feud. This can lead to even more tensions in a region plagued by political unrest.
Yes, Google is playing politics by replacing Palestine on its maps with Israel. In my opinion, Google is over-reaching its power by pandering to a Zionist view of Israel. I believe a resource like Google Maps should strive for providing users with unbiased and unfiltered information instead of playing politics.
As a disputed territory, Palestine is different things to different people. Some UN countries recognize Palestine as a state while others do not. Thus, there's no way to make a decision that would please everyone. But Google has to show something on its maps, and showing Palestine is just as defensible as not showing it.
Google is not playing politics by replacing Palestine with Israel on its maps. Palestine has not been a country for decades. Google is simply representing the reality with their maps. Furthermore, when Russia annexed Crimea in 2014, many news organizations then designated Crimea as part of Russia instead of Ukraine. Therefore, companies like Google are not trying to pay politics; they are simply representing the current situation with their maps.