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I think, if I understand the question correctly, the trick is to space the elastic just far enough away from the edge that it frills.

That being said, on the turned and top stitched diapers I did like that, the really didn't bunch too much. The serged ones did, and you could get the same effect doing an overedge stitch with your sewing machine.

You could also try the blind elastic method here . The elastic will be stitched through all the layers and the bunching should stand out a little more.

I hope this helps a little! Let me know if I need to be more clear. I'm a little slow today
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