What are the structures on the sides of and aft of the canopy on Israeli F-16s?
They're conformal fuel tanks, a type of external fuel tank designed for a specific aircraft type to reduce drag and other effects.

In general, they increase fuel load and free up stations for weapons or even more fuel.

In particular, the F-16 is a small platform with a modest fuel load and thus has a moderate radius even when clean. But when it's combat loaded with sensors and weapons, the additional weight and drag quickly eat into its combat radius, so one or two drop tanks are semi-permanently hung from its wings and/or belly. Don't quote me, but the CFT's almost double the F-16's internal fuel capacity.

The F-16 wasn't originally conceived for ground attack, carrying bombs for many of its missions, but it quickly grew into the versatile multirole platform it is today.

The USAF can better accommodate the F-16's short range because it flies a huge fleet of ~450 aerial tankers to service 2000 fighters, whereas the IAF operates just 11 tankers for 400 fighters. (Obviously other USAF a/c also require tankers, not just fighters.) Also, the IAF doesn't have the luxury of other nearby friendly air bases it can fly out of. Thus, they use CFT's. 

With the benefit of hindsight, the original F-16 design team would probably have enlarged the internal fuel tanks from the start had they known how the F-16 would be used.