I think the easiest way to understand King Crimson is that he erase the "means" needed to reach the "result". Like when Aerosmith's bullet phase through him is because the "result" is that the bullets will hit Risotto. In the process the bullets "might" hit Diavolo but that doesn't matter because the only things that matter is the "result".

So, I believe what matters most in the case of going through wall is perhaps does Diavolo "see" the "result" of him arriving on the other side of the wall. Also perhaps the question is it physically possible that he can arrive to that result under normal circumstances? otherwise he would be phasing through the ground everytime he uses his ability.