"We cling to memories as if they define us, but they don't. What we do is what defines us." - Motoko Kusanagi, The Ghost in the Shell

I would imagine that dementia destroys your ability to coherently decode your memories, but the brain connections creating those memories are most likely still there. You just can't get to them or use them anymore. If I had to make a (uneducated) guess, I would think of it like a computer: when you normally delete a file, you merely delete the pointer telling the OS where to look for that file's information. The file is still there, however (for now).

It's really interesting that parts of her mother are still there after most of the memories are gone. It's also interesting which parts of the memories remain. Simple, really ingrained concepts and ideas remain, but the more abstract and complicated ideas are gone.