Answer: Gosh, these questions are getting so deep. First thing I'd say, philosophically, is that just because something happens doesn't mean that there is a functional reason for it.

That thought had occurred to me long ago when a writer whose name I forget seemed to feel there was a need to explain how musical materials were functioning in certain avant-garde pieces. I thought: what makes him so sure they are functioning? They exist, is all: we won't know whether they actually function until enough history has passed that we can determine that these methods were chosen by what Hindemith called the ruthless process of natural selection in art. That was long enough ago that I can now conclude that the methods in question had no more long-term survival potential than a sheep born without a head.

That's by way of prepping for an answer. Certainly a passing tone can move either up or down, and the same applies to several passing tones together - even if they happen to form a diminished chord. The formal logic of dissonant tone resolution is not necessarily always observed, especially in music chromatic enough to make use of such a device. I'm not convinced that a Roman numeral analysis is helpful in a case like the descending progression IIIm7, bIIIdim7, IIm7. What has happened is just that a number of chord tones moved by intervening steps to the next strong chord. That is, I wouldn't necessarily look for a harmonic "why" here, but would think of this contrapuntally: if the voice leading is smooth the composer is going to get away with it. Unless he's in school. School needs to exact its own discipline, which is good for you.