If a Jew, living in a small village, dies, is it allowed from religious point of view that he be buried in the local non-Jewish cemetery?
You should do all efforts to bury a Jew in a proper Jewish cemetery. Should a family quarrelling or similar occur, I have found a similar case of a Holocaust survivor from the Netherlands, who didn't want to be buried in a Jewish cemetery. Here it is written that Jews should not be buried in the graves of non-Jews (Rashi to Gittin 61a):
וקוברין מתי נכרים עם מתי ישראל מפני דרכי שלום - לא בקברי ישראל אלא מתעסקין בהם אם מצאום
If such should happen חו"ח, a separate grave should be created instead and it should be separated from the others, for example by leaving at least 8 amot distance from the graves of non-Jews (see Igrot Moshe to Yoreh Deah 160 - top right in this edition) or by creating an at least 10 tefachim high mechitzah (Tzitz Eliezer Even Yaakov*).
Since it's a very sensitive and complicated issue, you should definitely ask for a pesak halakhah of the local rabbi.
I would be happy if one could link the related part of Even Yaakov.
All efforts should be made to bury a Jew amongst Jews.
It is an ancient Jewish custom to purchase a gravesite during one's lifetime and to own it outright prior to burial. The Bible states explicitly that Abraham bought a grave for Sarah. Likewise, Joseph was buried in the family plot that his father Jacob had acquired in the city of Shechem. [...]
It must be located among other Jewish graves, or on grounds bought by a Jewish organization for use as a Jewish cemetery. This has been the custom through the centuries.
The following are criteria for determining whether a particular cemetery is a proper burial place for Jews:
The purchase contract should stipulate that the area of the plot is designed exclusively for Jews.
Burial rights must be permanent. The cemetery corporation should not be permitted to exercise any authority with regard to the removal of the remains from any grave.
All facilities for Jew and non-Jew must be absolutely separate—with separate entrance gates, and with each section fenced completely.
According to Jewish law, a Jew should be buried among Jews. It is forbidden for a Jew to be buried in a mixed- denomination cemetery, or in a cemetery that allows the burial of questionably converted Jews.
Of course, should this become a real scenario, ask a rav and don't trust Internet strangers.