What is your opinion on a person who is not bedridden, being confined to an in-home hospital bed?

I would venture to guess the hospital bed makes him think he is in hospital; hence the confusion.

I would move the bed back to his bedroom and see if that improves things.

My answer depends on the level of care he has available. On the one hand I agree that returning to a more normal set up is optimal, BUT - who would be available to help him make all these transfers throughout the day, is that you? His ability to stand and transfer is a huge plus but not if someone has to lift him off the floor (I've been there done that).

I think that there is a fundamental difference between your expectations and those of your mother, you are hoping for at least a partial recovery and she seems to be focused on easing him toward a peaceful end.... I think a lot of those involved in hospice care tend to go there by default.

Even if he doesn't improve that doesn't mean his death is imminent, I've learned that people can live a very long time in extremely compromised condition. I think what you need is a realistic prognosis and timeline, unless he has something specifically life threatening he could live this way for years (as my mother did). I couldn't handle that level of care in the home, you need to decide whether you can.

***ADDITIONAL INFORMATION FROM ORIGINAL POSTER:***
Let me add that the Physical Therapist (PT) who was coming prior to this recent fall, has already come to do a re-eval. The HH and PT just recently began in late Sept/first of Oct. due to my grandparents having covid and symptoms being so mild, no one knew they had it. Also to add, besides my grandfather falling due to the brain fog it caused, his symptoms were far less than my grandmother's, as was the rate in which he recovered. He was absolutely mobile prior to this and prior to this most recent fall- my grandmother was also with him in the bathroom when this happened. She thinks she can get him up and do for him and help him if there's an issue, WRONG! (SIDE NOTE: my grandmother is fine- she just trips over her own feet due to not following orders, wear slide on slippers, and dragging her feet. She is stubborn in all aspects but most importantly, doesn't manage her diabetes, eats/does what she wants and when she wants, as well as sleeps all the time- regardless of PT telling her to do the exercises and move/do more around the house; that she's unstable on her feet and has weak legs b/c she's in the bed all day, she does the minimum and sees my help as a "I don't have to do anything anymore". She's gotten so lazy she doesn't go out to eat anymore, go to church, or shop which she LOVES... she doesn't even want to drive or travel- they have a beach and mountain homes. Her blood sugar is in the upper 200s to 300 because she eats pastries, bread, jams/jelly, half bottle of syrup, and whatever else she can get her hands on. High BS#'s make you have yeast infections -which she has, makes you eat even more- which she chooses more sugar, and feel like absolute garbage- which is why she's in bed. She's stuck in a vicious cycle. Yesterday (Sunday) her BS# was 495 and she took it again on the opposite hand, it was 521. She could've had a stroke. Alllllllll this is by her choice and disregard of my, mom's, the doctor's, and HH's instruction. She does NOT have dementia, she is fine. She's hardheaded and can be quite mean due to the irritability from the high BS. She takes 3mg injections of Trulicity 1x week and Metformin 3x/day and still....these numbers B/C SHE WILL NOT LISTEN AND DO WHAT SHES INSTRUCTIONED! Part of the doctors not 'hearing me" is because my grandmother has lied and downplayed hers AND my grandfather's health/condition for awhile. That's recently changed since I stepped up). The same 2 PTs/HHN's who sees my grandfather, sees my grandmother, so they're able to check in with either or, several times a week. The PT sees me every visit and relays everything to me, as do doctors, nurses, etc. I am the "face" that handles/deals with everything; obviously because I'm the one here and that takes them now. The PT is who instructed ME (as stated above, in my original post) not to encourage or allow him to walk. I however, was instructed on how to and when to transfer him, according to his care needs at the current time. I was instructed to have him standing, pulling himself up (with assistance- I use the belt in case) while using his walker....then using the walker to pivot himself to wherever he's going next. I WAS NOT INSTRUCTIONED TO KEEP HIM BED BOUND! The PT wants him standing and getting his legs/back stronger again THEN we will gradually work on getting him up and walking again. Again, THE ONLY LIMITATION IS TO NOT ALLOW HIM TO WALK, IN EXCEPTION OF THE FEW STEPS TO STAND THEN TURN TO SIT/LAY DURING TRANSFER TO AND FROM, WITH ASSISTANCE!!!!

My problem is my mother who is a nurse got mad at me when I stated I wanted to move the bed into their room, bring the chair back in it's original place. In fact this past weekend he transferred himself to the bedside commode and got back in bed upon waking up from a nap. This isn't necessary. I'm going to call the PT and relay the changes from this weekend and ask what he thinks about it. If he agrees, it's being moved back.

Has be been checked to discount a UTI? I would do this if you are able to get him to Urgent Care. UTIs in the elderly often have no other symptoms except confusion, agitation, memory problems and changes in personality. They can become septic if untreated. Antibiotics will clear it up. They can occur and reoccur for reasons other than hygiene.

"...my grandfather seems confused and keeps asking when will we go home..."

This is a common dementia behavior called Sundowning. He is most likely referring to the home of his youth (which is in his long-term memory), not his current or most recent residence. It often starts to occur in the late afternoon and science is not sure why, although the darkening of the day and the resultant shadows may throw off those with cognitive issues and triggers confusion and fear in their minds. One way to combat it is to turn more and brighter lights on earlier in the afternoon; distraction (not arguing or insisting he is already home); or engaging him in an activity he is capable of doing (like sorting things on a table like nuts and bolts, screwing nuts onto bolts, sorting and pairing socks, folding kitchen towels etc).

I agree with Cashew to not change anything until his eval from an objective and professionally qualified person. May you gain wisdom and peace in your heart as you work to help him along this journey.

If your grandfather cannot walk and collapses shortly after standing, he is technically bedridden. You may not want to admit that to yourself as you are discovering that that means there is more work involved for you than you would like right now, but it is what it is.
My husband was completely bedridden the last 22 months of his life in our living room, and even though when my grandson lived with us to help me out, and would lift him from his bed to his lift chair, he still was considered bedridden, as he couldn't walk or stand on his own.
Are you able to lift him from the hospital bed to the chair if it were in the same room? It's a lot to have to lift someone who is basically a dead weight, this I know, so before you go making all these plans to make your life a little easier, please consider what makes his life a little easier and get all your ducks in a row, as what you're wanting isn't that easy.
So I guess wait and see what the physical therapist says and take it from there, and then just make the best of whatever the outcome is. I wish you the best.

Leave him be until there is an actual evaluation.