RE: watches vs diamond ring
Watches, especially some brands, will either maintain their value or appreciate in value (as Rolex has seen for the last decade at least). Precious metal watches take a hit on initial purchase but beyond that they also hold pretty well. I think you have to hit the Omega tier at least though to reach that point. These watches, whether "sports" models or not, go with casual or formal wear as well.
Diamond rings are always a loss because the retail diamond trade has a 500-1000% markup. Not just the size but the overall quality of the stones, if you shop right you can do much better on price and get a much better bang for your buck, something that won't necessarily lose value the second you buy it. Despite the fact that the diamond trade is "manufactured" or was at one point, the trade is there regardless of what people think the real value is.
I have family in both the watch and diamond trade and at least that's how it's been for the last 5-10 years. Prices can always fluctuate and are prone to bubbles like anything else, particularly diamonds.
That said, cheaper watches, sub $1000, is no different in value than any other every day purchase IMO. Don't spend too much unless you're going luxury. I recommend Omega if you want something good quality that will last a long time and hold some value, otherwise just get what you think looks nice and is cheap or discounted (check SD I see sub $500 watch deals regularly for nice looking stuff).