It's the social division and the portent of future conflict people are rejecting.
It took 2000 years for Christians and Jews to reach a mondus vivendi with each other. So far Islam is showing few signs of mondus vivendi with unbelievers and relaxing its claims to justified universal dominion. As we know all too well, Islam's "kingdom" is not "not of this world" but very much of this world.  The World is to be physically made over into the will of "God". That is a recipe for endless war.
Until Islam crosses the theological threshold of live and let live, acts of toleration will also be acts of submission and legitimization of Islam's claims to the Earth and mankind's future. 
So in a sense the cemeteries conflict encapsulates the entire problem with Islam, its insistence of making the World over in its image, peacefully if possible, violently if it can. This theological stance can not endure.  
The World must be good enough for religious Muslims to be buried next to it.