Gratia, Unfortunately that is one of the most common behaviors of a dementia patient. And, it takes different forms, as I learned during my six years of caring for my wife. At times she would just ask who i was - other times, more often, she called me "daddy'. My response had to be different in each case - so when asked who I was, my answer was always I'm Fred, I'm here to take care of you. Most times that response was sufficient - other times it would upset her, (she didn't want me to take care), so I would just say that I would find someone else to do the job, or ask if she had anyone else she would prefer. That normally satisfied her, and the subject was forgotten in seconds. As to the "daddy" recognition - I would simply take on the role of "daddy", and ask if there was anything I could do for her at that moment. The main point is to not dispute your husband's belief of what he perceives. don't attempt to convince him that he is wrong - come up with some alternative, so as to avoid causing him becoming upset. Which of course, is not good for either of you.
Just give him all of the love and attention possible - All the best to you, be strong, take care of yourself, so that your able to take care of him.