I think Shoghi Effendi was closer to truth than the conventional interpretation. To properly understand what Jesus meant, we have to consider all the verses in John 12:27-33. By "Prince of this World", Jesus was referring to Christ Consciousness which is the "Son" present as Divine Intelligence in all creation and everyone including Jesus. He was saying that upon his death, the Christ Consciousness would be cast out from his body (since it is tied to the soul that will leave his body). Jesus went on to say that if his soul were lifted (resurrected) - that is victorious in spirit over death - word of his divine life and teachings would then attract the attention of all peoples.On the topic of "Prince of this World", this is in reference to John 12:31, which reads "Now judgment is upon this world; now the prince of this world will be cast out."
This verse and the surrounding verses speak of Jesus' death and resurrection. The conventional interpretation is, thus, the Devil is the "Prince of this World" who is cast out via resurrection.
Shoghi Effendi appears to have mistakenly read it as referring to Jesus' death, as him being the "prince of this world" who was "cast out" via crucifixion. This interpretation probably brought about since John 12:32 continues with "And I, when I am lifted up from the earth, will draw all people to myself."
Thus with one sentence talking about someone being cast out and the very next sentence talking about Jesus being lifted from the world, one could easily make a connection that the two verses were speaking about the same thing.
(Some other Baha'is might take umbrage at how I used the word "mistakenly" to describe Shoghi Effendi's read of this verse. I think it is important to keep in mind that Shoghi, by his own words, only possesses Isma (Infallibility) in regards to his interpretation of the Baha'i writings. We are given divine no guarantee of his accuracy in regards to the interpretation of the Bible, and as such it is possible for him to be in error or mistaken about a piece of Bible terminology. Given the widespread understanding of John 12:31, I'd think this interpretation was simply an misunderstanding.)
Jesus was not referring to the Devil by "Prince of this World" because there is no evidence in the words of Jesus that he was possessed by the Devil.