My mother lives in assisted living and thinks her neighbor resident is stealing her things. Then she hides them, can't find them, and gets really upset, even more convinced her neighbor is stealing. If she confronts her neighbor (verbally, not physically) the facility gets nervous and threatens to kick her out.
I would ask about how they have dealt with it before and what their expectations are. I'd like to know in advance where the line is and what they intend to do if your mom continues with concerning behavior. I'd rather know up front, so you can make other arrangements if necessary. I'd view the contract to see how much notice they need to give, but also look into how much notice they need IF ANY if her behavior is threatening.
I would also have a backup plan. I would begin to look for places where she may be more comfortable, with staff and setup for residents with dementia. No one wants to relocate, but sometimes, it's an opportunity in disguise.
As you know you can't explain this to your mom. I would take pam's suggestion and speak to the Director of Nursing. There may be something that can be prescribed that will lessen your mom's anxiety.
Have you tried to make nice with the neighbor? Explain to him/her that your mom has Alzheimer's and that you're working on a solution so he/she won't be troubled anymore? Sometimes the best defense is a good offense.