The 1.30 update is here: Party Dungeons! Achievements! Arcade! We're in the process of adding new info. NOTE: The Web version is not yet updated. There are a few lingering issues Lava needs to fix before that happens.
The full filtration process also invovles filtering the diamonds through a vat of diamonds before using those filtered diamonds to filter the water! If only they'd filter their filtration process through diamonds so this item description wouldn't be so long.