And if you add an panel mount pot, how do you limit the current so that you dont fry the diode?
By putting a resistor in series with the pot. The resistor's value is set to allow the maximum safe current through. At this point the pot serves to only reduce the current further, as a dimmer.
The first problem is that the pot needs to withstand the electrical wattage of the diode. For example: a 1W blue is 4.5V @ 1A, which is 4.5W of electrical power. Pots over 3W rating tend to be expensive and bulky. You'll also need fairly low value resistance for this task.
R = V / I
R = 4.5 / 1
R= 4.5 Ohms. So your series resistor should be 4.5 Ohms and also be able to withstand the 4.5W load. A 5Watt resistor should do fine. This is just for a 1W laser, once you start trying to dim 1.8A monsters you're looking at expensive parts.
You want your pot to be of the same order of magnitude as your resistor generally unless the load has a very wide range of operation. In this case, 5x additional resistance would yield a drop to 16% power, which is probably good enough. So, you would want a 5W rated pot with a value of between 20 and 30 ohms.
So:
LD+ lead from driver to 4.5 Ohm 5Watt resistor (or resistor network) to wiper (center pin) of 5Watt ~25 Ohm pot. Right pin of Pot (with the shaft facing you) to LD + pin.
Problem two: anything except a linear driver will try to raise the voltage being applied to the load (diode) to compensate for the reduced current getting to the load. This means that effectively only LDO and DDL style drivers can be used for this.