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I'm no expert, but from what I have read and heard, the dementia patient loses the ability to get the mental signal from one part of the brain to the body. So, he may want to pull his pants down, but the brain is not sending the hands the right signal and it can't happen. He may feel he has to go to the bathroom, but the signals are not going in the right direction. It must be frustrating, but there has to be some practical care application.
With my cousin, the Memory Care staff now place her on the toilet at certain times of the day. (morning, after lunch, after dinner, before bed,) I think that she goes at those times, but she also goes in her depends and they check those regularly and change them when needed. She is used to it now and it doesn't seem to bother her at all. She has no no infections or rashes.
I know it's a difficult thing to insist on, but if it's necessary, I think I would insist. You can explain why, keeping in mind that his ability to understand how keeping him and the house clean has been impaired. Convincing him or hoping that he will pick this skill back up is not likely, but you can discuss it with his doctor. You might see if something other than dementia is causing the problem.
I know this isn't your fault at all. Many people go through the same thing. I am just hoping someone has some helpful comments.