I noticed that out of all the types of venues I've hit with my demo CD, the senior places actually seem to listen to the demos the most. Maybe because they still actually have CD players? I've been told that they like to listen to my demos during other activities like dance lessons or exercise class.
As far as what to put on it, give them what you do best! I would suggest just try to change up the styles for each song, you know like a Latin, then a swing, then some rock n rock, country...
You'll probably want to focus on the mega hits from the 30's to 70's with maybe the 50's as the sweet spot. In my experience you can't go wrong with Elvis or Sinatra.
I've been considering making a video of a performance at a senior center and maybe having it edited to small snippets of each song, put it on youtube and send the link to the activities directors. Maybe make DVD for the residents too?