I could see an iWatch, at least for the novelty factor. I don't really know what you'd do with it...tell time? Tinny-sounding Bluetooth speakerphone? Extremely tiny Facetime video chat? Siri search...?
I see it as being an effective notifications panel that requires less of an effort/context-switch to check on things. New email, shows up on my wrist, I can glance and see if it's worth the thought to read/reply. Same with texts.
Maybe I do a simple swipe and it shows me selected stocks, another direction and it shows me the weather.
Kind of think of it like the 2nd, exterior screen on my old Motorola Razr. Quick, easy, doesn't require an unlock or pulling something out of my pocket.
Better/more direct notification if I've got it on silent/vibrate (sometimes I've missed vibrates in my pockets).
Almost purely for display/notifications, not for actually doing anything, except perhaps playing/pausing music or other simple yes/no controls such as activating Siri or accepting a phone call.
Apps could have APIs that use it for such things. Maybe tap it to check your jogging distance in a GPS app, so you can keep your phone in a belt pouch where it doesn't bounce around while you jog. The iPhone/iPad to which it is connected, has the sole configuration capability.
In sort of the same way that the phone/tablet has become a "second screen" to my main computing device, the watch would become a second screen to the phone/tablet. Condensed, simplified, not as powerful, but easier to carry and to deal with in general.
(Side note, no not really, this is actually the main point of this entire post: while writing this post, I used my iPhone to briefly check email (subject/from lines only), and to check tomorrow's weather. I'm sitting right here at my MBP! It would be a simple matter to make a new tab and pull up weather.com, but somehow, mentally, it's easier to use the iPhone. I've got probably 40 other tabs open in my top browser window; I've got work stuff scattered all over my physical and electronic desktop; 18 applications open, one of which is Parallels, which is running apps within it like a Goddamned Matryoshka doll; I've got enough clutter, enough shit going on on my computer already. My phone is a respite, it only does a few things, but damned if I don't prefer it, for those things that it does. It lets me get by with not thinking by only showing me a few things at a time and only letting me choose among them, rather than showing me, literally, I can see all or part of 11 different windows right now, along with the aforementioned 40 tabs... sometimes I try to do something and I click around in bewilderment until I find the thing I want.... we've let things get so complicated, there can be a real joy to simplicity and constrained choices! This is what I don't understand when I hear the Android fans gush about how you can configure your phone to do this and that and whatnot... sorry, I don't want to, I don't want to have to think about it!)
I really like the Pebble. Based on the demos/reviews that I've seen, I think that it does most things right. I think it needs to be priced at/under $100 to really catch on. (I would probably buy one at $100.) A dash of Apple design/hardware/UI/marketing expertise couldn't hurt, either.