I was re-watching the recent BBC production of "Sherlock", which is excellent, btw.
Saw Holmes flash his watch a few times, and finally got a decent screenshot.
Solve the mystery... photo below.
The picture is from the "The Hounds of Baskerville" episode, Season 2, Episode 2.
Watson also visibly wears a watch in Season 2. But it's a big square thing, and doesn't look too interesting.