The decision does not close the investigation or clear the suspects, but without knowing how Dayan died, police have been unable to establish the evidence needed to sustain a murder allegation.
The arrests all occured on major Israeli highways as the drivers were transporting the Palestinians.
Dayan’s family said it learned that a body had been found through media reports rather than directly from police.
Two fatal shootings in Israel's Arab sector within 24 hours have left two men dead, with police probing possible criminal motives behind the attacks.
The mother of missing 23-year-old Eldar Dayan arrived at the scene, pleading to police to "take her to the child" and allow her to see the remains for identification purposes.
An explosion heard across northern Tel Aviv was caused by a suspected fragmentation grenade thrown at a residential tower, according to Hebrew media reports.
Attorney Arbel Feldman is survived by his wife and three children. His family said it was in shock and asked that his photograph not be published.
The suspected offenses included fraud, breach of trust, obtaining something by fraud, theft or fraudulent misappropriation, false entries in corporate documents, and other offenses.
The suspect is alleged to have operated a number of social media accounts through which he would publish incitement against Israel and the IDF, alongside praise and support for Hamas.
A Lahav 433 investigation named David Appel and former MK Michael Kleiner as the suspects in a multimillion-shekel real estate fraud probe.
Fallen soldier Sgt. Yehuda Peretz was killed when the vehicle he was traveling in crashed into a barrier on Route 222, only a month before his wedding date.
