Hello Dan,
From your post it appears you are having an issue with the microphone on your Apple Watch.
We suggest that you start by confirming that both the iPhone and Apple Watch are up to date on their software:
Update your iPhone, iPad, or iPod touch - Apple Support
Update your Apple Watch - Apple Support
Check and make sure that nothing is covering the microphone. The microphone on the Apple Watch is on the lower right edge of the watch face.
Make sure there is no water in the microphone. Put the device face down on a lint-free microfiber cloth and look for any water dripping out. You can try and dry it using that same cloth.
Restarting the Apple Watch is also a good step. While simple, this can refresh the iOS, apps and connections.
If the issue continues, you can try unpairing and then pairing the Apple Watch. When the watch is unpaired, a backup is created. You can use this backup to restore the watch when it is paired again: Unpair and erase your Apple Watch - Apple Support
Here are the steps to pair it back: Set up your Apple Watch - Apple Support
Have a good day.
