Countries, as a rule, don't have a right to exist. People have a right to self-determination. These are different things. That said, Israel is fundamentally an Apartheid state. If Israel stopped being an Apartheid state it'd stop being Israel. And if a state needs to treat half the people in it as second class citizens to exist then it can go die in a ditch.
There's also a good possibility that one of the high ranking military officers will use the opportunity that will arise from the chaos to orchestrate a coup and put themselves in power.
That is, admittedly, a possibility I hadn't considered.
This treaty has been active for 50 years, what would Israel gain from destroying it?
If the treaty remains active then makes sense, but I doubt anyone will care about a peace treaty with a failed state. You know how when a country just falls apart its neighbors go after the pieces? That's the sort of scenario I'm envisioning here. Admittedly my thinking might be overly simplistic, and I should've considered more orderly possibilities, but at least in the Syria-style absolute chaos situation I'm imagining (which after thinking about it isn't as likely as I thought) of I don't see why they'd honor the sovereignty of a state that ceased to exist, in the same way nobody really cares about Syria as a sovereign state anymore.
Is there something on the ground that is not apparent in the media our Egyptian diaspora?
Not really; it's just that I doubt the army will give up power peacefully. Hence civil war or violent revolution. And in both cases it wouldn't be strange if Israel decided to expand into Sinai during the chaos.
You only say that because you don't know how Egypt is looking like right now. Egypt's economy is the worst it's ever been in decades because of mismanagement, and it's not getting better. We're seeing the government build new bridges and cities using our tax pounds while people can't buy food. They're borrowing money at absurd rates to try to keep the whole thing from collapsing and paying back by selling the counter piecemeal to gulf states while refusing to actually fix anything. People keep having to find places to cut back on food and other essentials just so they don't starve. We can't get enough fuel for the country so blackouts have been going on for a while and it's killing newborns in hospitals. Hell, a guy I know had a 9-hour long blackout recently.
Egypt's economy is in free fall right now and there's not much more room for falling before people starve. Some kind of revolution is going to happen within the next few decades (because people don't like to die of starvation) and you know what happens when the people try taking back control from a military dictatorship. Where exactly it'll be on the Frenchrevolution-Syrian civil war (which started because the Syrian government refused to give up its power) spectrum I don't know, but given what I've seen from other examples in the region and the behavior of Egypt's government I am very much not optimistic.
Uh... Egypt did not collapse in 2011. That was a regime change. I'm talking about a Libya or Syria-style failure to keep existing as a sovereign state.