Prednisone and early dementia. Anyone else see this phenomenon?

Maybe, and this is just a theory.. maybe he has Delerium misdiagnosed as dementia and the Prednisone helped with whatever illness it was that was causing the delerium

I would speak with a neurologist to see if they've ever heard of this. It's possible they are aware of any current research studies they could point you to. Prednisone can have the unpleasant side-effects of hyperactivity and aggression.

Is your husband diagnosed with any particular type of dementia? Lewy's in early stages often has ups and downs in mentation, unlike many other dementias (Alzheimer's is one) that have a downward trajectory without any upswings. I would not hold out hope for prednisone, thought it DOES have profound effects on mentation for some people, generally in the opposite directions. Steroid psychosis is a known phenomenon. In that steroids have this known effect it is interesting you are noting mental changes, and these must be reported to your husband's MD.
Do know that for medical issues your best path forward is to discuss this change, you and your husband, with his supervising physician.

"Prednisone is used to treat many different conditions such as hormonal disorders, skin diseases, arthritis, lupus, psoriasis, allergic conditions, ulcerative colitis, Crohn's disease, eye diseases, lung diseases, asthma, tuberculosis, blood cell disorders, kidney disorders, leukemia, lymphoma, multiple sclerosis, organ..."

I would not take this long term because of the side effects. I would bring this to his doctors attention though. It is not unusal for someone to show signs of Dementia at 61 but he is young. Maybe he has been misdiagnosed and there is something else going on here.