Zion Williamson better hope New York doesn't end up with the #1 overall pick ... 'cause Jay Williams tells TMZ Sports he's not confident the Knicks owner would know how to handle a player of his caliber. 

"I live in New York City, so obviously everybody wants the answer to be New York. But, I don't know if I trust James Dolan enough with that yet."

And why? Jay -- who was outside The Cabin NYC -- doesn't go into detail, but it's pretty clear he's referencing ALL the missteps Dolan's taken recently ... which includes booting fans for telling him to sell the team.