What happens to the in-wall volume control if the amplifier power is greater than it can handle?

It will not be pretty but then again no one will die. Typically, the magnetics of the volume control will be over taxed, saturate and thereby become a lower impedance than rated. This will encourage The Director amplifier to put out even more power possibly putting the amp into protection. If not this extreme, there is an excellent chance the volume control saturation will damage the sound quality. The upshot is use a volume control with a margin of safety.