As for Looney Bins and Madhouses...Should they ever be mentioned you can truthfully say that of course there are no such things now.
My husband's consultant simply told him he had slipped over into the Mild Alzheimers stage...But I guess there IS, at that stage, a duty to the patient to tell the bare facts.
Husband strenuously contested the diagnosis, but, the formalities had been addressed, and afterwards we would both mention it lightly in conversations, as a bit of mild forgetfulness...and a bit of a joke because there was no problem, just "the odd funny moment...we all have them as we get older."
That gave us the opportunity to set up, without fuss, Powers of Attorney..we both did it, naming our sons as secondary attorneys in case either of us couldn't do it in future...
It was years before I could no longer cope at home, and we introduced a new friend who would keep him company, either taking him out, or staying in with him. That was invaluable.
When it came to moving into a Care Home, we let him think I lived there too..so he usually believed I was simply busy in another room, There were times when he did understand and would ask to go home. We never said he couldn't, simply said the builders/ decorators were in and we'd be going back when they had finished... That was easier for a husband and wife, but probably you'll be able to convince your mother she's just visiting...and it's only temporary...
The truth would have upset him a lot more than the stories we told..sometimes he was more lucid than others, and it was difficult, but mostly he could be reassured, and that's the best you can do, I think.