My stepmom has something very much like dementia. We don't know exactly what it is - at first we thought it was because of the heart attack she had a few years ago but it's gone beyond that I think. Plus her mother had it as well, so I'm guessing that's the reason.
As for homes: Fortunately my dad can take care of her for now - she is mostly functional in day to day activities (but she can't cook a meal, or remember what she asked you ten minutes ago), but if anything ever happens to him, she is going to have to go into a care facility. I sure can't take care of her, I know that much.
I have absolutely no idea what the care facilities are like around here. I'm hoping they're better than the one my mother was in when she was alive - that one sucked big time (at least one of the nurses openly STOLE from her).