When Charles becomes King, Prince William will become Prince of Wales,
Maybe.
The titles Prince of Wales, Earl of Chester, are not automatic titles.
Charles actually waited longer than any other Duke of Cornwall before being created Prince of Wales, Earl of Chester - 6 years.
The instant the Queen passes Charles becomes King and William will become HRH The Duke of Cornwall and Cambridge, Duke of Rothesay etc etc.
Whether Charles decides to create William as Prince of Wales will be a personal decision by Charles and will also take into account the feelings of the Welsh people and Welsh Assembly.
There is no reason why Diana having held a title for 15 years more than 20 years ago should stop her son and his wife having the title in the future.
I can see Charlotte becoming a duchess when she marries. Just like the #3 will be a duke or duchess as well. I don't see Charles or William denying the spares that title.
William and Harry's kids will all be working royals because it is just the two of them. I suspect Charles has a great chance of reigning well into his 90s like his parents. So that means by the time William take over he will be in his 50s and his kids will be early 20s.
That means William, Kate, and their three kids? Nah. Harry, Meghan and their kids will quite busy as well.
If the rumour of a 'smaller' royal family is true there is no way Harry's kids will be working royals as that will simply see another large working family as we have today. After all they will be the cousins etc of the monarch - as are the Gloucesters and Kents and therefore need to be supported by that cousin.
If the number of working royals is analysed by generation we end up with:
The Queen's - 8 (at the most)
Charles' - 5 (at the most)
William's - 4 (assuming the rumours of the York girl never going to be needed)
Why would George's generation want to go up again - 4 would be fine (George and spouse and his two siblings) so no need for Harry's children or for Charlotte's spouse or the new babies siblings.
If we are to say all of William and Harry's children and Harry also have three children you are already at close to the number of the Queen's generation which reportedly seen as too many. It isn't the relationship to the monarch but the number needed.