watchOS 10.4 update is stuck on "Preparing...". Please advise.

Did you already try these suggestions?

...

Try these steps:

1. Make sure that your Apple Watch is connecting properly to its charger. 
2. Restart your Apple Watch.
3. Restart your paired iPhone.
4. Try again to update your Apple Watch.

If the update won't start:

1. Open the Apple Watch app on your iPhone.
2. Tap General > Storage.
3. Delete the update file.
4. Try again to update your Apple Watch.

...

copied from: Update your Apple Watch - Apple Support

I have the exact same issue:

the update got stuck in “preparing” phase

i deleted the install file ( which was 1.05 GB)

power cycled both iPhone and watch ( series 6 watch)

it got stuck at the exact same spot and the file was again 1.05 GB

deleted the file and gave up.

They need to fix this.

Same here. I’ve tried every fix I’ve come across and still nothing. Seems like something totally broken on Apple’s end.

This worked for me, eventually. Restarted phone, then looked for file to delete as instructed. Could not find the file so went ahead and restarted watch. I was taken back to the initial update start page and clicked download and install.

The install process started over, but during the preparing stage I got a notice that the install failed. I clicked ok and was returned to the start. I tried again and the install was successful.

Not sure why it finally worked.