Word for someone excited who foolishly fantasizes?
Solution 1:
I would call him quixotic:
Quix`ot´ic Pronunciation: kwĭks`ǒt´ĭk
a. 1. Like Don Quixote; romantic to extravagance; prone to pursue unrealizable goals; absurdly chivalric; apt to be deluded.
Solution 2:
These are false hopes or, more perjoratively, delusions. Your characters are delusional.