The word I get from Israel is that the M16 is far more popular than the Galil with the troops in the field, particularly the various carbine or M4 types they are switching to. Easier to carry, easier to shoot, and sexier looking (and yes that counts, too). Very few M16A1s or 2s left in service. They gave most or all of the A1s to the Palestinian police, as part of the arrangement Clinton brokered.
Most of the remaining Galils in service seem to be w/units in the north of the country, though that may well be part of a phasing out by unit plan.
As I long time owner of a Galil, an AR15, an M4gery, and an XM177E2 clone, I can tell you that if I had to go into the field again, I'd take the Galil ONLY if I was in a partisan type situation w/no possibility of repair or replacement of my weapon. As a regular grunt in an organized unit, give me an AR