The main challenge, mechanics-wise would seem to be how to include the Jewish religion in a way that doesn't make it a proselytizing religion, which it wasn't and isn't. With the pagan religions, there is a clear a-historical, alternate history-choice to reform paganism, but Judaism is already set. If you included Judaism, you should either not be able to proselytize, and/OR have massive penalties to conversion like these:
1. Only Levantine culture counties can be converted to Judaism.
2. The option to use a courtier to convert one's heir, would not be possible with a Jewish courtier if one's character is non-Jewish.
3. Conversion outside the Levantine region is absolutely impossible.
4. However, minor bonuses to convert Levantines in the historical Judaean/Israel region.
Imo, this could be the mechanics that would seem fitting in a hypothetical Jewish DLC.
Also, in regards to how you actually make Jewish characters in regards to ethnicity versus religion. Have all Jewish courtiers be Levantine (it's the in-game culture that comes closest - similar to how Somalians aren't really Ethiopians), except for Khazars and the Ethiopian Falashas. Those two cultures are not able to convert non-Levantines, either.
So, I think that covers all the mechanics. And I've actually asked in a previous thread for the official post why there was no Jews, and no, no one has ever posted or claimed it was for any historical or "racially sensitive reasons".