All 3 major Israeli carriers have micro-sims (they all sell the iPhone): Pelephone, Cellcom and Orange.
The cellular coverage is excellent with all 3 carriers, and you should expect good 3G signal 99% of the time.
It's anybody guess what pricing and policy they will have by summer, but right now they all offer free micro-sim and pricing ranges from 15$ for 1GB of data to 40$ for no-limit data access.
It's a monthly based contract, but you can cancel after a month or two. There isn't any liability from your part to the contract.
If possible, go with Pelephone. According to speedtest.net, they are the fastest cellular carrier in the world.
Anyway, there shouldn't be any problem, and I advise you to check again closer to your trip. If you're having any problem and need someone local to check things for you, feel free to drop me a PM.
Have a great trip...
EDIT: Never mind, just realized someone has resurrected this post from last year. I'll keep the post for anybody else that might be interested