Setting the barn on fire. How seriously should we take his threats?

My FIL is 75 and has depression and pseudodementia, with some possible vascular dementia. The past few months he has threatened to set the barn on fire when he doesn't get his way. One afternoon out of the blue, he very calmly told my MIL that "Some day you are going to wake up, and you will look out the window and have a big surprise, because that barn is going to be on fire." He explained to her that he was angry about us taking his ladder away so he was "just going to set the whole damn thing on fire". I alerted his psychiatrist and he admitted to her that he said that and that he might actually do it. Instead of admitting him, she got him started on TMS (he's already been on meds). About a month later, when I was driving him to his psych appt, he was angry that his wife refused to give him a hair cut (it's not true, he was just confused) and he said to me "I think I know what I need to do..." and I asked him what but he wouldn't tell me. I asked him if it was illegal and he smirked "That's for you to find out!" I asked him if he was talking about setting the barn on fire again, and he admitted he was. I tried to talk him out of it, we had a whole conversation about it. At the doctor's office, I alerted the staff and they were very rude to me but he did talk to a staff member and his doctor. I wasn't invited into the conversation. Apparently he admitted to the threat to the doctor but refused to go to a psych hospital, so they just gave him back to me to take home because "he didn't really mean it". He was furious at me of course.

My question is, how seriously should I take this? He is mentally and physically capable of starting a fire. My house is right next door to his and we live in a fire-prone rural area. Setting a two-story barn on fire would be catastrophic. He's also made threats to sabotage the heavy equipment because he isn't allowed to use it anymore, and even to cut the cord off the hair trimmer! I suspect these are just idle threats, and that's what the doctor believes, but when he was younger, he did actually do nasty things to "punish" people who didn't do what he wanted (he locked his wife out of the house for hours, hid behind a door and poured a 2 liter of soda on her face because she "disobeyed" him, he even took his son's dog and abandoned it in the woods because the dog made him angry. Luckily his wife rescued it). He is absolutely abusive to his wife and always has been- she is his servant/doormat. He threatens to sell the house and take the money away from his wife, or disinherit his wife and son and give the money to charity, but I'm not as worried about that because he doesn't have the mental capacity to even dial a cell phone. And of course he makes suicidal threats. Luckily he voluntarily gave up his guns years ago. We tried to get him to live in AL but he refuses (and would a facility even take him with this kind of behavior?). He's going to a new psychiatrist soon for a second opinion, and me and my husband have a an appointment with our lawyer and a social worker.
Should I be worried for the safety of myself, my home, animals etc? Is this typical of dementia? If his threats mean nothing, how should I respond to them? Should my husband try to get guardianship of him, since he has durable POA? He's been in the hospital a bunch for suicidal threats but when they release him, he's the same.