My personal view is that this is ultimately a hopeless goal.
If you mean that people will misinterpret it no matter how clear it is, I agree.
Any list of particular rules is going to have to be interpreted, at some point or other, by reference to the purpose/underlying value that those rules serve. After all, no one thinks (as far as I know) that the paladin's code is arbitrary in its content; it is a code adherence to which makes the paladin a certain sort of exemplar.
They will have to be interpreted to a point, yes. Much as a druid "reveres nature", or the like, and people have different takes on what that means (even if the author goes on to clarify).
A paladin must respect life: some people think this permits, or even mandates, the killing of orcish children; whereas others think it forbids that killing.
I only played in 3.X, but I don't remember "respect life" at all in the code. If it was, the sentiment should be made more clear, I agree.
A paladin must never lie: some people think that lying to fiends is an obvious exception; others (including me) think that telling the truth to fiends, no matter what the cost, is part of the very point of paladinhood - it is a confrontation of iniquity by honour and valour. Etc, etc.
If the code says "act with honor (not lying...)", then I think it's abundantly clear that the Paladin can't lie without losing his powers. People will still misinterpret it, yes, but the same goes for any strong thematic material (druids, clerics, warlocks, etc.). I still want to keep those strong themes around, so I say if some people misinterpret things, oh well. Don't let perfect be the enemy of good, and all that. Make it as clear as possible, and then let people play the game.
If all the group of players hold roughly the same moral/political views - or if the ingame situation is designed so as not to raise any matters on which members of the play group disagree - then disputes may not arise. But that's a fragile assumption on which to build a core mechanic for a game. Hence my preference for options here.
I think the "problem" has more to do with trying to squeeze standard moral views into the alignment system. In my game, Good was literally a defined force, but to my players, it wasn't always "the right thing to do" (and they were Good throughout most of the game... two started as Neutral, but transitioned to Good). This led to some pretty interesting conflicts in the game (the Herades philosophical discussion, backing up Good people just because you're Good, clashing with but never attacking a Lawful Evil Monk NPC that only hunted Evil people, siding with Asmodeus for the greater good [not Good], etc.).
Hopefully alignment is optional anyways, though. I like it in my D&D, but clearly enough people have real problems with it that it's just an option. As always, play what you like
