Can you Connect two watches to one phone

Yes, but you should not do so if they will be worn by different people.

1. Because all the data is synced with the same iCloud account on the phone.
2. 2. That's not possible. The watch can not use an Apple ID other than the one on the phone it is synced with.

If you set it up with a child using family set up, it is not paired with your phone.