Does acute hyperglycemia affect nerve function?

Yes. The duration and severity of hyperglycemic episodes are major risk factors for the development of diabetic neuropathy. The process for this is not entirely well understood likely because there are multiple effects of high blood sugar on disrupting nerve cell function and tipping the balance from cell repair to nerve cell death.
The "Big" Nerve. Longstanding hyperglygemia can of course affect peripheral nerve function -- neuropathy is a well-known, chronic complication of diabetes. Acute hyperglycemia could easily affect the "big nerve" in your body -- your brain. Altered consciousness, from confusion all the way to coma, can result. Hoping you and your doctor are working on your blood sugar control so that this doesn't happen.
Depending on level. Critical elevation of blood sugar, such as ketoacidosis could be life threatening, and can affect brain function diffusely including coma. Peripheral nerve function should reverse readily once control occurs. Chronic type 2 diabetes without tight control has high potential for neuropathy.
Yes. Hyperglycemia means the sugar is elevated in the blood stream and is not available to the target tissues. Glucose dependent target tissues include nerves. Controlling blood sugar actually means getting the sugar out of your blood into the cells so that energy/fuel is available to these cells, including neurons. Chronic hyperglycemia damages blood vessels to the nerves - neuropathy.