@denisefrey You have certainly taken on a huge job! I certainly respect you for doing so. As a nurse who dealt with many elderly patients and those with dementia, I can say that what your brother in law is going through is pretty common. When you think about it, he went from his home to 8 weeks in a hospital (which is constantly busy with lots of people), then to another new place. But he should adjust with time. ( Just a hospital stay of a few days can cause disorientation and confusion.) Put lots of his personal things in his room to help him feel at home.
You’ve done a wonderful thing for your BIL and in time it will be OK.