There was no point in the series where Nick or anyone else thought Adalind was mentally ill. Nick took her in because she was the mother of his child and needed protection. It wasn't even out of affection. It was all for Kelly. The affection grew from there but there was none in the beginning.
If Nick truly thought Adalind was mentally ill he would've had a conversation about it with another character. We know he thinks she's a wonderful mother because he talked about it. We know he was worried about the return of her Hexenbiest because he talked about it. We know he doesn't blame her for going to the mansion because he talked about it with Adalind. Nick thinking of her as mentally ill would undoubtedly been put on the screen.
If Nick truly thought Adalind was mentally ill he would've had a conversation about it with another character. We know he thinks she's a wonderful mother because he talked about it. We know he was worried about the return of her Hexenbiest because he talked about it. We know he doesn't blame her for going to the mansion because he talked about it with Adalind. Nick thinking of her as mentally ill would undoubtedly been put on the screen.