Where did you read/hear that the uncle was Muslim or would have a problem marrying a Jewess? There are Jews in Iraq. Not many, but they are there.
Oh I know there are Jews in Iraq. It's really none of our business, but no one has come up with a name, or any info on this uncle. If in fact he is Muslim, any non Muslim would be strongly encouraged to convert. It's in the handbook.
I didn't read or hear about this particular instance, but I do know the level of burning hatred there is for Jews.