Hehe - it could be a sense of sending a crook to catch a crook, I suppose!

Interesting article, by the way. I'll have to ruminate on it for a while, but one thing that immediately jumps out at me is the issue of placing Israel and Singapore side by side - the Israelis I have met have all had a much stronger sense of nationhood than do Singaporeans. Maybe it's because they have all been Jewish, so I can't really comment on how non-Jewish citizens see Israel. However, comparing Israeli Jews and Singaporean Chinese, I can't say that the two groups really share a level of patriotism.
At the end of the day, it would be a case of weighing ethnic and nationalistic sentiments against each other, and feelings towards the incumbent government would be of relevance here. Even without ethnic issues being involved, the military could turn against the government - Gregorio Honasan's mob and military units in the 1917 revolutions are examples, and had the German generals gone through with their decision to overthrow Hitler before crossing the Rhine, they might have succeeded. The risks, regardless of source, may be ameliorated by the government's image to the people as being righteous.
Another clear example of a Trojan Horse that comes to mind is the assassination of Indira Ghandi. I thought it was rather unwise of her to have maintained Sikh bodyguards after raiding the Golden Temple (which in itself was a terribly bad move). As awful and politically incorrect as it sounds, it does stand as a case against the integration of minorities into the armed services.