According to Israel Finkelstein, Israelite settlement began over half a century after the writing of the Merenptah Stele (he has never explicitly stated this fact, however), after Philistine destruction of lowland towns (according to him, Israel was originally a nomadic population which relied on farmers’ produce).
According to William Dever, Israel Finkelstein originally (in the 80s) dated Israelite settlement a century earlier than he does today.
William Dever does not seem to provide any explanation for why, if Merenptah’s Israel originated in the lowlands, it would use a form of pottery not commonly used, but clearly descending from, the Late Bronze tradition while the same tradition continued in the lowlands for some half century (remember, Lachish VI did not fall until after some date between years 10-19 of Ramesses III). Also, very few Egyptian artifacts were found in Israelite sites, excepting some clearly out-of context scarabs at Mount Ebal, and some other (so far, unknown to me) sites. According to Kenneth Kitchen’s OROT, pg. 227, Early Iron I Israelite settlement was primarily concentrated in the area east of Shiloh and Shechem, extending toward Izbet Sartah from the Shiloh area, (according to Finkelstein, this phase was characterized by faring-pastoral communities) while Middle (mid-11th C) and Late (late 11th and early to mid 10th Cs) Iron I settlement was primarily concentrated in the West (according to Finkelstein, these phases were more concentrated in Oil and Wine production, beginning Israel’s rise to civilization). This seems to show an East-West movement of settlement. It is, therefore, best to date Izbet Sartah III as being a latecomer in the Early Iron I settlement process. However, Izbet Sartah, on the northeast site of GivatHaSelaim, is still important, largely due to its thorough excavation, its early date, and its easy comparison to nearby Aphek, almost exactly three kilometers directly to the west. Aphek was inhabited in the 12th C BC (stratum x11), but a detailed comparison of it with other sites has not been made. However, to Finkelstein’s eye, Izbet Sartah was obviously later than, say, Lachish VI. Also, if Merenptah’s Israel was the Early Israel of archaeology, why are not far more Late Bronze forms found among the pottery forms of Early Iron I Israel? Even though the earliest settlement phase may be stretched quite a bit (having its beginnings as far as the 1190s-60s, perhaps, if the High Chronology is used), it seems clear that Early Iron I was not contemporary with Merenptah.
So, what was Merenptah’s Israel? As the archaeological evidence shows, and Todd Bolen points out, it is simply unlikely to have been a settled entity during the time of Merenptah. It must have, therefore, been some kind of powerful Bedouin entity, originating in the 13th C BC or earlier, prior to its settlement. An Egyptian origin for some of these Bedouin leaders may be postulated.