I would think your Mothers greatest desire would be to stay in her own home. I have personally watched my Mother go thru several stages of dementia over the past couple of years.
And while I don't have any siblings, and my house has all of the bedrooms on the second floor - I also have several severe health conditions myself including cancer coming back three years ago.
Initially ..... I think your Mother being in one place only would be a close second to being in her own home - especially if it's with a loved one. With the deterioration of the mind with dementia, her new home with a loved one will soon become her new and comfortable home - I believe!
Now ... does your sister have any kind of training ... and is she very patient ... and does she get her feelings hurt easily! These are all important factors, and there are short evening courses (often free) for caregivers that could help her anticipate what to expect.
I did, until they stopped the program, go to a community weeky forum for caregivers. It was moderated by a young trained lady (probably in sociology) and the sole purpose was to provide an escape for each of the caregivers for 90-minutes a week. We heard stories of others. We were able to get suggestions and given direction by the moderator.
I would highly suggest that for someone considering being a full-time caregiver.
If .... there is a marriage or children living at home .... being a full-time caregiver could very easily destroy a family. So ... perhaps that's where the other sisters can come in .. for relief .. to give the caregiver a break - and family too if there is one.
Consider also, that dementia is usually a disease that gets worse. I've seen that in my Mother over the past two years or more. Not just incontinence which is pretty typical - but at some point, just moving around from one space to another.
Two years ago, my Mother needed a cane to walk - and was just beginning to use a walker. In the past 4-months, she rarely uses the walker anymore - she's moves by wheelchair now. And that requires wider doorways and no steps .... etc. etc!
In my Mothers case, the doctor told her in April/May of 2011 that in order for her to be released from the hospital togo home - she must have 24/7 care. So she had an in-home caregiver for 15-months. It's expensive.
Then, as the dementia got worse and her nightmares became a little visious, she went into the hospital for observation and medication prescriptions. Her doctor then said he would not release her to go home - even with 24/7 care. She needed to be in a facility with a full-time nurse. She has been now for a little over a year.
One other thing, that in time, she may fall often. My Mom is starting to fall out of bed very often - and it's in the middle of the night. When she falls, it takes a very well trained person to lift the dead weight up without hurting her. It could take two people.
You have a good start, some good thoughts and planning - but consider ... your Mothers condition will get worse. And nearly no one person can handle the responsibility of taking care of someone 24/7.
Please consider one more thing, many dementia patients can get ornery ... or even nasty sometimes. And believe me ....... it is much easier for them to scream at a loved one than to a nurse or non-related caregiver. It's not fair ..... but it does happen. I've heard it myself way too many times from my Mother. It is very hurtful - something to give consideration.
Well, your family has much ahead ... but if done as a family, I think it can be a manageable duty. Good luck to you and yours.