An interesting observation, and my interpretation of it:

The generation who lived with God on a daily basis after the exodus from Egypt and experienced His overwhelming miracles did not believe in God (as evidenced by the golden calf, etc.). But later generations, who haven’t had any physical interaction with God, believe so strongly that they are willing to kill and die for God. WHY?
In the Torah, when God revealed himself to Moshe and started to communicate with the Israelites, He had a dilemma: How close could He get to them without affecting their ability to stay independent and exercise free will? In the past, God’s closeness with Abraham had caused the later to lose his independence: Abraham was willing to sacrifice his only son from Sarah without any questions or complaints. Previously, when Sarah asked Abraham to expel his other son, Ishmael, he had resisted. We have to keep in mind that God is perceived by humans as the all Almighty – one without limits – infinite. But in the desert, God’s deeds for the Israelites were, relatively speaking, limited. God’s deeds were far more “ordinary” than what His potential abilities were most likely PERCEIVED to be. So here is the dilemma: If God is to reveal Himself and make the “Almighty” impression, then His actions need to transcend events like the ten plagues, the splitting of the sea, or giving the manna in the desert.  He needs to go all the way… Just make them wake up in the land of Israel… But then He has gone too far…
In our time, as long as He is ONLY in our imaginations, His potential is unlimited, and that is why we believe in Him so strongly.
Obviously, God was fully aware of this paradox. He expressed his thoughts at the end of slavery in Egypt when He replied to Moshe’s question about His name:  “I will be what I will be…” God’s dilemma is reflected in this statement: “I will have to walk a fine line, depending on circumstances along the way – because you humans have free will and I have to keep it that way.”