first time you watered the tree, most of the fine dust was washed out.
DE is not TOXIC, that is incorrect use of the word toxic. A sensational exaggeration. DE dust poses an OCCUPATIONAL inhalation hazard with chronic exposure. Months and years of daily exposure would be necessary to cause health problems like silicosis. Casual, occasional exposure is not harmful.
You do have asthma, consult your physician, if he requires you to wear a dust mask while handling wheat flour when baking cakes, then you should wear a dust mask working with DE. *note, professional bakers in industrial factory-kitchen settings do indeed wear dust masks. There is a big difference between the dust from 2 cups of flour for a small batch, and the dust from 2 tons of flour for a batch of Wonderbread.