I've just written them a letter suggesting that perhaps they should stop. I don't feel like I can recommend the product to friends while they're doing this, even though it is well-designed, saves money, and reduces the economic and environmental waste associated with shipping excessive amounts of water and packaging around in trucks.
WhoProfits is run by Israeli Jews who oppose current policies, many of which are actually illegal even under Israeli law. (Evidently some noticable percentage of the stone and gravel used in construction in Israel is coming from quarries in the West Bank. Imagine if Canadians were setting up quarries across the border into Minnesota, without permission or payment, and simply stealing our country's natural resources. We'd be pretty mad, right? Israeli law is pretty unambiguous that this is not OK -- but the law is poorly enforced. After all, it's not like bits of gravel have return addresses on them.) Everyone agrees that Israel has a right to defend itself from terrorism, but there has to be a better way. And much of what's going on inside the West Bank, now, is straight-out exploitation, with little security value. Certainly the settlement movement is; if Israelis want to avoid security threats, why in G*d's name would they move onto Palestinian land, which is both provocative (not that violence is justified in response to that, but anger sure as hell is) and puts them in harm's way, unless the state is willing to spend a gajillion dollars on protecting them?
One might say, at least they're providing jobs -- but of course the pay is extremely low, because the Palestinians are desperate, and due to the extensive network of internal walls and checkpoints, they're completely unable to conduct commerce for themselves. (A Palestinian businessman who wants to travel with goods over the 30-35 miles from the north to the south end of the West Bank will have to pass through four or five checkpoints along the way. At each one, he will have to unload his truck so the goods can be inspected, carry them across the checkpoint, and load them into an entirely different vehicle. As you can imagine, perishables do not survive such a journey, and even with durables, the added cost is prohibitive -- especially when a competing Israeli firm can ship goods along walled-off roadways, avoiding the checkpoint hassles.)
This is no more ethical than when an American firm hires undocumented immigrants, paying them below minimum wage, and tells them they'll be fired (or worse, reported to La Migra) if they don't work long hours with no overtime or if they complain about unsafe working conditions. Sure, they're giving money to somebody who needs it -- but they're also taking unfair advantage of desperation, and undermining wages for all workers.