In this work the adiabatic approximation is applied to the propagation of matter waves in confined geometries like those experimentally realized in recent atom optical experiments. Adiabatic propagation along a channel is assumed not to mix the various transverse modes. Nonadiabatic corrections arise from the potential squeezing and bending. Here we investigate the effect of the former. Detailed calculations of two-dimensional propagation are carried out both exactly and in an adiabatic approximation. This offers the possibility to analyze the validity of adiabaticity criteria. A semiclassical (sc) approach, based on the sc Massey parameter is shown to be inadequate, and the diffraction due to wave effects must be included separately. This brings in the Fresnel parameter well known from optical systems. Using these two parameters, we have an adequate understanding of adiabaticity on the system analyzed. Thus quantum adiabaticity must also take cognizance of the intrinsic diffraction of matter waves.