Cotton wool disease is caused by poor or sudden change in water conditions. When asked if the water was OK SSmith answered "Ithink so". I suggest he / she checks it.. Local supplier should give them an anti bacterial infection remedy . Best to isolate the fish and treat. Starts as whitish tufts around the mouth then spreads to fins and body. Can lead to ulcers.
It maybe that the water conditions are ok as they say the orfe are fine. Orfe are sensitive and are usually the first to turn their fins up at poor water quality. It may sound horrid but that is why I have Orfe in my pond ( albeit =I do like them as well!!!). It is a bit like having a canary in a cage down a coal mine. If the water is OK then it sounds like the fish may have been stressed.
The ideal ph is 7 to 8 especially for KOi. Fluctuations up to 11 are not uncommon and should not hurt the fish. Goldies are tried and trusted and hardy. Watch out for Orfe as they are sensitive to poor water .
Apart from sealing the watercourse what do you have in the pond? Concrete slabs etc will increase the ph so consider getting rid of them and using something that will not effect the chemistry.
More important than ph I would suggest is ammonia / nitrites / nitrate levels. These are the ones that will do the real damage especially the first two.
Some fish will change colour like this. A couple of months ago I persuaded a friend to give me a 'fairground' goldie that was too large for its 'bowl'.Ugh!!!!!
Put it in the pond where it has now learnt to swim properly. Noticed a few weeks ago it turned black all over its head. The head has now gone back to gold but the whole fish has gone a more yellow colour.
Time of year will also effect some fish as they get fruity and prepare to get 'their fins over!!!'