Hello SanMcK70,
Thank you for using Apple Support Communities.
We understand that after updating your Apple Watch you have noticed that podcasts are automatically playing after updating. You have turned off "auto-launch audio apps" and tried turning that option on/off, restarting the iPhone and watch without change. The first thing to check is the version of watchOS, there have been several updates to watchOS 7, with 7.0.3 being the latest. Use this article to check what version of watchOS you have installed:
Get information about Apple Watch - Apple Support
If you not at watchOS 7.0.3, then we would recommend upgrading the Apple Watch.
If the issue continues after you are on watchOS 7.0.3, then we would recommend unpairing the watch and then pair it again. See this support article:
Unpair and erase your Apple Watch - Apple Support
If you need further assistance, get back to us and we can go from there.
Best regards.