What stage of genocide is "Population distinguished between Ottoman Turks (Muslim) and Armenians (non-Muslim, Christians). "

This happened in the first stage of genocide.

Explanation:

The Turkish government has made up its mind to make the country homogoenous when it comes to ethnicity and religion. This meant that everyone in Turkey should be Turkish by ethnicity and Sunni Muslim by religion. One ethnic group in particular though was a thorn in the eyes of the Turkish government, that being the Armenians.

In order to start a process of genocide, they played tactically an step by step. What they did first was to set a clear distinction on the ethnic and religious base between the Muslim Ottoman Turks on one side, and Christian Armenians on the other side. This was done because it opens up the gates for divisio between the populations which makes it easier to convince people to later act aggressivelly when they don't feel any connection to the other group.