Hi Salukigirl,
Sounds similar to my Grandma. She's got late stages of Alzheimer's as well. I can feel the pain you are in. I grew up with my Grandma since my mom was/is a single mom and had to work. I lived with her from 15-21. She swung on me with a knife, so the doctor said it wasn't safe her us to live together anymore. She stays with my mom while I live in her house. She doesn't recognize my Mom and I either. It's tough on the family. She was the greatest...always did everything for the family. She sometimes thinks her husband is still alive and he died about 18 years ago. When she gets in a bad mood (for a lack of better terms) she says how she wishes she was dead as well.
I really hope things get better for you and your family. I agree with John, she's so lucky to have people there despite her condition. If she were coherent, she would very much appreciate everything you guys are doing/have done. Too many times you hear about a family just 'dumping' the elderly and not giving it a second thought.