Earlier quoted context omitted.
How was it illegal for ICE to request the data? It certainly wasn't ethical, but what is right and what is legal are not the same thing. Hell it sounds like the only law broken according to the article was a Washington State consumer protection law. Hence the settlement is against Motel 6 and not against ICE.
Perhaps it's not illegal by the letter of the law, but it certainly seems like a major injustice to me. Could it be considered entrapment if Motel 6 was pressured into giving ICE the information?
No, because ICE agents are not agents of the State of Washington, and the prosecution was by the State for violations of State law. ICE agents are, in terms of entrapment, no different than ISIS agents would be in this case.
EDIT: Also no, because entrapment is a criminal defense, and this was a civil consumer protection case.