As the Israeli team settled into the Athletes' Village, the IOC studied a letter from the Palestine Olympic Committee asking Bach to ban the Israelis, citing the bombings of the besieged Gaza Strip as a breach of the Olympic truce.
The letter sent days before Friday's opening ceremony "emphasised that Palestinian athletes, particularly those in Gaza, are denied safe passage and have suffered significantly due to the ongoing conflict".
It said "approximately 400 Palestinian athletes have been killed and the destruction of sports facilities exacerbates the plight of athletes who are already under severe restrictions".
But Bach said in a press conference: "The position of the IOC is very clear. We have two National Olympic Committees, that is the difference with the world of politics, and in this respect both have been living in peaceful co-existence.
"The Palestinian NOC has greatly benefitted. Palestine is not a recognised member state of the UN but the NOC is a recognised National Olympic Committee enjoying the equal rights and opportunities like all the other NOCs."
He added: "We are not in the political business, we are there to accomplish our mission to get the athletes together."
The Palestinian call highlights how the rising death toll and growing humanitarian crisis in Gaza is impacting the Paris Games.
France's foreign minister has already had to intervene to stress that Israeli athletes are welcome after a far-left French politician called for them to be barred over the Gaza offensive.
'Best village'
Competitors flooded into the Olympic Village in northern Paris, with national flags hanging from many windows.
Some of the biggest names set to perform at the Olympics -- American gymnast Simone Biles and Spanish tennis pair Rafael Nadal and Carlos Alcaraz -- have been spotted at the village.
Reviews of the food and accommodation were broadly positive, but some people reported issues with the transport to and from sports venues.
"Usually at Olympics, the transport takes a bit of time to work out," Tom Craig, a player in the Australian hockey team, told AFP.
"We've heard about some teams getting taken to the wrong venue, but it hasn't happened to us. One day we got a bit lost, but it was fine."
American gymnastics coach Sam Mikulak, a veteran of four Olympics, praised the village as the best he had seen.
"Ten out of 10. It's the best set-up, the best conditioning space (gym), very organised," he told AFP.
Dujardin out
Meanwhile, Britain's joint most decorated woman Olympian, dressage specialist Charlotte Dujardin, withdrew from the Games after a video emerged showing her making "an error of judgement" during a coaching session.
It was not immediately clear what three-time Olympic champion Dujardin had done but Olympic and equestrian authorities have taken an increasingly strict line against alleged improprieties relating to the treatment of animals in recent years.
During the delayed Tokyo Olympics in 2021, a German modern pentathlon coach was thrown out the Games for striking a horse.
In other developments, as organisers put the final touches to the opening ceremony on the Seine, videos posted online showing US pop star Lady Gaga in Paris sparked rumours that she will be among the performers.
The line-up for the ceremony, the first time a Summer Olympics has opened outside of the main stadium, is yet to be fully announced.
Paris Mayor Anne Hidalgo said she hoped the weather would be fine for the ceremony after rain on Tuesday.
"We don't make the weather so we will anxiously watch what it will be like on July 26, but we will make do and they will be exceptional Games."
