Gaming

I mean, it's definitely at least intended as a play on words. And Knockturn Alley kind of works at least, because it's meant to be a dark/shady street, it's specific name being "Knockturn" rather than "Nocturn" works well because its also, functionally, directions. You knock to get into Diagon Alley, then you turn to go down Knockturn Alley. But yeah, the name Diagon Alley seems to exist exclusively for the sake of the word play, potentially even just to set up the mispronuncuation with the flu network later on the series.

I know what you're talking about, but I think it was intentional.

Books for children and young adults often have an "I'm 14 and this is deep" aesthetic. And in this case, JK could especially lean into that trope because she was trying to present a wizarding world that was above the muggle world.

So, things were different and complicated just to throw the muggles reading the story off-balance and give a sense of depth or wisdom where this is in fact none. And then JK could say this is on purpose because it's a muggle trait to expect rationality or meaning behind things that have none, and so the muggles continue to prefer to live in the box they put themselves in. Once again, "I'm 14 and this is deep".

I read this series once as an adult. It was enough.

Knockturn alley was where the dark arts shops were. What would the dark arts be if not nocturnal?

And Diagonal Alley runs diagonally between an existing block in London.

Okay I made that last part up, but it could be true enough.