88 yr old mother confused; should inderal (propranolol) be switched to water soluble form of medication? No problems before confusion.

Perhaps. If confusion started after starting propranolol, it might be worth the try to switch to alternate beta blockers to see if symptoms improve.
See doctor. If Inderal (propranolol) is causing the confusion, she needs a change in medication and not just the formulation of the same. Talk to her doctor about it.