Cats with dementia can have an amazing quality of life! I've had two of my seven develop/be diagnosed with it - one was 6 at diagnosis, and he lived until he was just a few weeks shy of his 22nd birthday (of old age), whilst the other was 9 at diagnosis and he was 13 when he passed (from a brain tumour).
I think the important thing is, as you say, the quality of life that the individual cat has - and it'll be different for every dementia diagnosed feline, I'm afraid, just as it is with people. But it is possible to ensure that they continue thrive and enjoy their lives. My experience is of indoor only cats, though, so if yours has been half-in/half-out it may well be different. Personally, I'd be worried about something happening if the cat was used to being outdoors - but you may well feel differently.
Adaptations for them? Well, I had to block hidey holes which we couldn't easily access, because the 9 year old would forget how to reverse and/or turn around, and then panic. And the older one took full advantage of demanding food every hour, on the hour during the last year or so of his life (which I put down to the dementia, but... could just as easily be because he knew I was under his paw). Other than that, there weren't any. They both knew how loved they were, they felt very safe in their home, the older one had one of the other cats we had at the time (we had 5 together - 4 toms, 1 queen, all neutered) act like a carer for him which was very sweet, and the younger one preferred to sleep touching one of us as though we were anchoring him somehow. If your cat isn't an only, you may well find that their companion will "assist" them, though, just as we do with our human loved ones who develop dementia. With our older cat, the youngest of the 4 toms would position himself between him and the edges of sofas and beds, so that he couldn't fall if he forgot he was near them during his naps, and they'd all allow him to eat first. The youngest (non-dementia) tom also took over his grooming on his "off" days.
Signs you may have missed that your cat was developing dementia? Ours took to sitting and staring at corners. One would talk to the corners every now and then. Apart from that, though, I honestly can't remember. I know the diagnosis of the older one, when he was 6, came as a huge shock and, like you, I wondered if the kinder thing to do would be to make the decision not to have him continue with his life. But our vet talked me round, and I am so grateful that they did.
If your cat has a favoured person, knowing their little quirks will help you to recognise when they're having an "off" day, or a "good" day. Recognising any patterns to their behaviours will help you to help them. Especially if their "off" moments are aggressive ones - I know we were very fortunate that our duo's "off" moments weren't ones that involved teeth and/or claws, but they could just as easily have been!
There is hope. And there is a genuine chance that your cat will have more "good" days than "off" ones, so a higher quality of life for a long while yet. 
and a handhold, because I know it's a scary diagnosis, and I think not one that people tend to associate with animals.