I know this sounds daft considering I know that the dementia is the cause of her hallucinations but sometimes the things she says scare me. For example 2 nights ago she woke me up at 4 am because there was a "man in a black cloak in her room" so as usual I go in and check for burglars and all, all clear so I put her back to bed and she asks me to stay while she falls asleep. Im sat on her bed and I say yeah sure nan it's just a bad dream don't worry and she said. For gods sake lily he's got his arm around you, stop acting like you can't see him. It really scared me. I know it's just the dementia but it does scares me. Does anyone else ever get scared by the things they say?
Perhaps when she demands that you must see him you just say, "I'm sorry but this is your dream, Nan, and I can't see what you see in your dream. Sometimes at your age dreams continue a little after you are awake. It will fade away soon. And I'll stay here until you fall asleep."
Sometimes my husband's hallucinations/delusions would have scared me if I had them, but they didn't scare him. So I just went along with them. "Yes, dear, I'll stay out of our bedroom until the medical examiner comes and removes the body. While we are waiting, do you want a piece of the leftover pie?"
I think with delusions that scare the person you can't quite go along in the same way, but the goal is not to argue, to reassure them of their safety, and try to distract them to a different subject.