Son (who often asks about the will and appears to be concerned with his inheritance, doesn't like the idea of paying for AL) believes that dad with dementia in AL will be able to go home if dad is given medication to calm him down. He sees no reason why his dad's wife (his stepmother) shouldn't be his dad's 24/7 caregiver. He believes a change in medication will solve all problems. His dad makes many demands on the stepmother to help him do things he's been told he can no longer do (driving, banking, etc); dad is demanding and persistent. Dad's wife is 70. Dad is 81.
Progressive dementia gets worse. Sometimes some of the symptoms can be addressed and that can improve the quality of life. In my opinion, this should be pursued with a highly-experienced specialist. For example, if something can be done to reduce anxiety, that is worth trying, for the sake of Father and his family. However, even if some symptoms can be addressed with drugs, Father will still have dementia, and it will still get worse. He will still not be able to drive or to manage his own finances. He may (or may not) be more pleasant to live with, but he will still need the same level of caregiving he needs now, and that level of need will continue to increase.
Who should decide whether his wife could/should provide 24/7 caregiving? His wife. Lots and lots of factors go into such a decision, including her health, her skills, his health, the level of care needed, the current rate of progression of the dementia, the nature of their relationship, and resources available for respite care and in-home care. Note that whether Father is calm or anxious is just one of many factors, and would seldom be the sole deciding factor.
Everyone involved should know that sending Father home to his wife also has costs associated with it. One individual cannot provide 24/7 care to an adult, no matter how loving and devoted she is. Paid help will be required, and the need for that will increase as the dementia progresses. Also respite care is an absolute non-negotiable requirement. WIfe is going to need time away, to maintain her sanity. This can be costly.
Those who are inheritance-watching should know this: Unless the resources are vast, it is not very likely that there will be much of an estate to divide. In this case, Father may need care for another decade or more, and it is likely to be increasingly expensive care. By that time StepMother may need care herself -- let us hope not significant care, but there are no guarantees about that. Most non-wealthy couples are lucky if they can pay their own way until the end, let alone have some leftover to pass on to another generation.
You asked for advice. Here's mine:
1) Explore with a qualified doctor any drugs that may improve Father's quality of life.
2) Let StepMother continue to be the sole decider of whether StepMother will provide 24/7 at-home care. From the scant information in the question, I'd recommend against bringng Father home, but in any case it should be his wife's decision.
3) People who are counting on a large financial legacy from this couple should make other plans.