My answer may be a bit broader than the question.
Both may be be accurate or may intend to convey same thing but I can understand why KJV seems to be ambiguous and confusing as it ends with "of Israel". This preposition "of" might lead to the understanding as from Israel or descended from Israel implying- Not all Israel are from Israel. That means
not all Israel are [just] the descendants of Israel
all Israel are not just from Israel
thus Gentiles could be Israel as well. It is also crucial where we put "not" in the sentence. Phrase Not all must be maintained for whole-Israel or Israel1, otherwise it may change the meaning significantly.
For all are not Israelites that are of Israel (DRA)
for all they are not Israel, which are of Israel (GNV)
Not all who are descended from Israel are part of Israel (CEB)
This interpretation or rendering reverse the order of first and second Israel. If the order remains correct where Israel 1 is whole, and Israel 2 (saved Israel) is the subset then it leaves no room for confusion.
There are many translation that may prove to be confusing or misleading on this verse that ends with "of Israel" and the usage of "not". This is an interesting topic for translation issues but I doubt it has been discussed thoroughly by scholars.