Is dementia ever diagnosed purely based on testing? i.e not taking into account clinical history or activities of daily living?

No, dementia is a rather complex diagnosis that includes comparison in time or dynamics, mini mental/memory tests, imaging and lab tests as well as general exams. Many times confused with delirium in the inpatient ward, where docs are unaware of the patients baseline performance status and dynamics are assumed rather than objectively confirmed.

Diagnosis of dementia starts with clinical problems, such as memory loss, supported by cognitive abnormalities on clinical exam. Neuropsychological testing provides confirmatory support if appropriate. The daily situation must always be addressed, so that safety and stability is assured.