The legal position is that your grandad is entitled to dispose of his possessions anyway he chooses while he's still alive.
Seeing as he has dementia obviously he can't. If he's given a power of attorney then the attorney has similar powers, but should exercise them cautiously so that noone can object that he's not doing his job right.
Otherwise it's whatever the family can agree - an equal division is likely to cause least argument but is not really an absolute legal requirement in itself.
Best way may be to sell all the possessions and then divide the money equally