If her father came from a family of soldiers, being born in Italy might make sense. I do find it interesting that the death record only names the mother as Jane Setter. If she was a British subject born abroad and registered, the birth should appear at the GRO. Also, if Joseph was stationed in the UK in 1851 (worldwide index 1851 census), then Jane should be somewhere in the UK as well. There won't be any additional records in Canada that you haven't already found.