I lasted about four weeks before I moved out again. I didn't like what boomeranging was doing to my relationship with my parents.
Unless you do university as a mature student, you go to university pretty much as a child and emerge as new grown up. When you go home after uni... you act like a child and your parents treat you like one. Because that was the norm last time you lived together full-time.
Is his masters in something likely to lead to a job? Or is it just another way of deferring joining the real world?
A lot of graduates these days are shocked that they are unemployable when they have done naff all other than a degree. They don't realise that degrees aren't special. Plenty of people making hiring decisions have degrees and know how much effort they took. And those people managed to combine a degree with someone else, just as a part-time job somewhere terrible to make some money towards uni costs.
A graduate who has a degree and nothing else is not going to find a decent grad job, and shouldn't be shocked at that.
Hindsight doesn't solve anything, but it doesn't explain your DS's attitude. He thought he was going to walk into something shiny and the reality has been rather more grim. He's likely frustrated, disappointed, embarrassed... and he's living in a situation where he doesn't have control over his own movements (it's too rural for decent public transport), he's regressing to childhood (like I said, it happens when you move back in with your parents) and he's probably comparing him to people (some from his degree will have got the shiny job he thought was his).
I think the reason for the medication is important. You haven't have to tell us, OP, but I imagine the fact he needs expensive medication is another thing that is 'unfair' about his life and is adding to the despair. It may also inform the way he is able to cope (or not) with this situation. I think you should bear that in mind when considering the way forward.
Is there someone he could talk to about his work situation? His university will likely have a careers service available to graduates. What about a relative or family friend in the sort of area/level he'd like to be? Basically... is there someone who isn't one of you who can help? It's not a criticism of you - and I think once he moves out again, he'll be more receptive to your guidance. It's just at this point, I'm not sure he's going to be able to listen to you, no matter how good your advice is.
Did his elder brother eventually sort himself out? Is he in a position to talk to him?
I also really sympathise. People have a tendency to take things out on the people they love and trust the most, as they know no matter how hard they push, they're still going to be loved. It's really shit for you.