I'm sorry to hear your dad isn't well, Ijustwanttobeme, and I can totally empathise with you trying to work out how to get him as healthy as possible. Obviously your GP will be able to say whether he needs to go into hospital or not.
I'm posting to tell you what my experience with my late mum was - there's lots of differences in their cases, but given the time again I think I'd make different choices, and I thought it might help you to know what happened with us.
My mum spent months in hospital, in and out, and while it kept her with us for longer than I think would have been the case (thought possibly not), it was absolutely rotten for her quality of life, and she hated it. There was the reassurance that someone was there 24 hours and other adults were awake to keep an eye on her at night (we were wrecked looking after her at home, with lack of sleep), but otherwise it was a hospital stay, with all the noise and discomfort that this implies. I wish in retrospect that we'd taken her home a lot, lot earlier, so she had the comfort and reassurance of familiar surroundings.
On the eating thing: my mum had the appetite of a baby bird. I hope very much your hospital is different to ours, but honestly, the nurses, etc, didn't have the time to sit with her and tempt her to eat the way we could, so I don't think it helped in that direction at all in the long run. We were the ones who got her to eat when we visited, who bought in little bits of her favourite foods, and so on. One thing you might consider is how easy it is for you and other people to visit him if he does go into hospital, so you can do this too.
I hope your dad is with you a lot longer yet, and if he needs a hospital stay to sort something specific out, that's one thing. But if it is just a case of him wearing out (as we all will, in time), you and he have to decide what kind of life he wants in the meantime, and what kind of life you want with him.
Have you got a loo downstairs? If so, is there room to put a single bed (or better yet, a hospital-style bed borrowed or hired from a nearby home) somewhere nice downstairs, where he can be more in the middle of things, where it is easier for people to visit and tempt him with tidbits you know he likes, and where there is more to stimulate his interest in life, and so on?
Good luck, I justwanttobeme, and I wish you and your dad all the best, whatever path you choose to take on this.