If I list an item on ebay 100 or so competitors will watch the item because they are nosey bastards who want to see what Im up to. Its never helped me sell anything though so I can't imagine how it would work as a sales tool.
Maybe if you only had 3/50 of an item left with 20 watchers ? that might make people hit the buy now a bit quicker.
Pointless and stupid. Also it'll most likely be a good way to get your account suspended.