Check out all of the above for some sound advice. Could she be allergic to the diaper? Some people are more sensitive to them then others. They could be too lose or too tight and cause an irritation. Ask yourself when does she itch? Maybe it is her way of telling you that she needs to go or time to be changed.Something that should be considered but is often ignored (for some this next sentence will be a eww- gross factor) but depending on the stage of her disease touching herself could be a natural self soothing activity.
Restraints and dementia really do no mix. Restraints usually bring on behaviors, agitation and frustration. Imagine if you had an itch and couldnt get to it. Restraints can also be dangerous as the person works to get out of them. The first thing that needs to be investigated is why she is itching. Does she have yeast? dry skin? vaginal infection? Does she need an antihistimine or ointment to give her relief? Keep her fingernails trimmed short. You might try using clothing as an obstical for her such as bib overalls or a full kitchen apron. You might also give her itemsto hold and mess with to keep her hands occupied.
If you have not tried previously, try to eliminate the reason for scratching which there are many reasons. I would first try making sure your mom is cleaned frequently. more frequently than at present. Then, apply some medication to eliminate the itch if there really is one. Your mom might be bored and need stimulus. Unless, she is actually harming herself, try not to use significant restraints. Perhaps bulky gloves when you are not around or some sort of jumpsuit as mentioned above but without area specific openings that might cause the problem. Get her excited with pretty jumpsuits. What about as in animals when you want them to not lick you put a collar arounf the head as in a cone, you could construct some manner of that to make it difficult to do such behavior. Creativity is fun and good. But, keeping sanitary may be your best bet. God Bless you for caring for your mother.
Oh I understand and sympathize. My father did this. I found some after he died. Basically, the openings are in the BACK of the jumpsuits so their hands cannot get in the front of their clothing.
Good luck and my prayers are with you.