I have reviewed the data on page 62 of Module 7 on the "New Israel." I would like to know if one could conclude from B., B1 a-d on the Church viewing themselves as the New Israel that the Church has thus replaced Israel (Replacement Theology).
I believe Don's point in context was that the concept of "elder" has its root in Israels understanding of elder. This was carried into the first century Judaism, as seen in the Sanhedrin.
Thanks so much for your inquiry into the reference of the New Israel, or as it is referred to in Paul's letter to the Galatians, the "Israel of God," see Galatians 6:14-16 But far be it from me to boast except in the cross of our Lord Jesus Christ, by which the world has been crucified to me, and I to the world.  For neither circumcision counts for anything, nor uncircumcision, but a new creation.  And as for all who walk by this rule, peace and mercy be upon them, and upon the Israel of God. (By the way, all references below are taken from the ESV).
In the context of Galatians (and Romans), Paul's argument is to persuade those who are dependent on mere physical lineage and identification with Abraham that true faith, rebirth by the Holy Spirit, and a new creation in Christ are the real fulfillment of Abrahamic lineage. As you know, this is the heart of the NT struggle between Jew and Gentile, and whether or not Gentiles could actually have a place in the people of God. While this may be a "no-brain-er" to us, this was a genuine issue: can Gentiles actually belong to the household of faith, seeing that they are not of the physical lineage of Israel. The heart of the problem is summarized by Paul in Ephesians:
Ephesians 2:11-13 Therefore remember that at one time you Gentiles in the flesh, called “the uncircumcision” by what is called the circumcision, which is made in the flesh by hands—  remember that you were at that time separated from Christ, alienated from the commonwealth of Israel and strangers to the covenants of promise, having no hope and without God in the world.  But now in Christ Jesus you who once were far off have been brought near by the blood of Christ.
This idea of Gentile inclusion by the blood of Christ lies at the core of apostolic teaching about the universality of the Gospel, and transforms our understanding of circumcision and the children of Abraham. Look at the texts below:
Galatians 3:7 Know then that it is those of faith who are the sons of Abraham.
Galatians 3:9 So then, those who are of faith are blessed along with Abraham, the man of faith.
Galatians 3:29 And if you are Christ's, then you are Abraham's offspring, heirs according to promise.
Galatians 6:14-16 But far be it from me to boast except in the cross of our Lord Jesus Christ, by which the world has been crucified to me, and I to the world.  For neither circumcision counts for anything, nor uncircumcision, but a new creation.  And as for all who walk by this rule, peace and mercy be upon them, and upon the Israel of God.
Romans 2:29 But a Jew is one inwardly, and circumcision is a matter of the heart, by the Spirit, not by the letter. His praise is not from man but from God.
Romans 4:12 and to make him the father of the circumcised who are not merely circumcised but who also walk in the footsteps of the faith that our father Abraham had before he was circumcised.
Romans 9:6-8 But it is not as though the word of God has failed. For not all who are descended from Israel belong to Israel,  and not all are children of Abraham because they are his offspring, but “Through Isaac shall your offspring be named.”  This means that it is not the children of the flesh who are the children of God, but the children of the promise are counted as offspring.
Philippians 3:3 For we are the circumcision, who worship by the Spirit of God1 and glory in Christ Jesus and put no confidence in the flesh—
These texts are merely representative of the general tenor of Paul's claim that now those who cling to faith in Christ are the true circumcision. This understanding of the Christ is not a replacement of physical Israel (what you refer to as replacement theology, which is no where claimed in Capstone as valid interpretation of the physical Israel. In other words, Paul is contrasting the church, believing Jews and Gentiles now united in one body in Christ with the “present Jerusalem” (Gal. 4:25). Now, the true people of God are the believing children of Abraham (Gal. 3:7, 29), who belong to “Jerusalem above” (4:26–27).
For those who would claim that the Church "replaces" Israel, they simply should read carefully Romans 9-11 where Paul is clear that the full promise of God to Jacob and Israel, despite their untimely ignorance and disbelief, shall be fulfilled to the physical descendants of Abraham. Again, do not think I teach or have ever taught the Church as the replacement of Israel. This doctrine, which is usually incorporated into British-Israeli or manifest destiny kinds of theological views, has nothing to do with the Nicene-grounded theology of Capstone.
By the way, your point is well taken about the reference to the "New Israel" being developed in correlation to the elder-ship of the Church, which is clearly informed by and built upon the role of the elders in the people of Israel in the OT. Peter makes the connection directly in 1 Peter 2:9-10: "But you are a chosen race, a royal priesthood, a holy nation, a people for his own possession, that you may proclaim the excellencies of him who called you out of darkness into his marvelous light.  Once you were not a people, but now you are God's people; once you had not received mercy, but now you have received mercy." This text, which is a reference to a number of OT descriptions of Israel, is directly applied to the believing Church here. It suggests that we can, in our leadership of the Church, learn much from the continuity between Israel and the Church, and glean into what faithful under-shepherding truly is by observing the Lord's standards and exemplars in the OT people of God.