Don King regards Jillian as an absolutely vital ally. In fact, he suspects that she may be the only person who can save Erfworld from total destruction. He also likes her personally, regarding her as his "sweet, cranky, warrior-Queen". He first met Jillian at the moment when he realized that Stanley posed a far, far greater threat than anyone had previously believed. Because of his ability to secretly observe events through his bats, Don may have seen far more of the Battle of Gobwin Knob than anyone realizes. He understands that Stanley poses both an ideological threat (because of his claim to a new Titanic mandate), and a strategic threat, (because Gobwin Knob has weapons that can wipe out an entire armies). This new awareness has forced him to reassess many things, including his views on the importance of Royalty.
Don may have been watching Jillian though his bats since long before he met her. It's not clear exactly how much he knows about her, but he certainly knows that she is a young Royal with extraordinary combat abilities who has good reason to hate Stanley and who has demonstrated some capability to predict Stanley's actions. After meeting her in person, he decided to help her rebuild Faq.
But then, he learned at some point that Ansom, whom he knew Jillian loved, was not, as previously thought, croaked. Instead, Ansom was leading Stanley's forces as his Chief Warlord. This may have led Don to question how Jillian would react to Ansom's apparent decision to support Stanley. Could Jillian be trusted, or would she join forces with her lover Ansom? It may have been concern about which side Jillian would fight on that caused him to demand that Jillian pop a Royal Heir, because producing a Heir would dramatically slow down Faq's ability to pop other units. When Don learned the truth about Ansom from Queen Bea's final message, he probably realized that his assumptions about how Jillian would react to Ansom were wrong. It was after this point that he dramatically increased the resources he was sending to Jillian in order to expand Faq's military.
After discovering that Charlie had attempted to manipulate Transylvito using Jillian as his agent, Don has been forced to reassess his perspective once again. Between the serious threat Charlescomm poses to his side, Parson and Jack's slander, and Jillian's own unreliable nature, Don King now fears that Jillian wasn't who he thought she was after all.