Same issue here.
My watch was able to work well unlocking Mac before I had it unpaired, repaired with the same iPhone and restored from the exact backup created during the unpairing process. (Had to do this because Apple Maps and Find my Friends were not loading any map.)
After that, all I get is "Your Mac was unable to communicate with your Apple Watch".
iOS / watchOS / macOS all on latest versions update to date.
I have tried:
1. Turn off/on Handoff on iPhone, Mac & Watch.
2. Restore Apple Watch, give up backup and set as a new Watch
3. Turn off bluetooth on iPhone, forget all wifi hotspots on iPhone & Mac, turn off/on iPhone & Mac, access 2.4 GHz wifi, turn on bluetooth on iPhone & make sure Watch regain wifi access without iPhone's bluetooth on.
4. Test handoff by opening Mail app on Watch and be able to see handoff working on both iPhone & Mac.
5. Sign out/in iCloud
Nothing worked until:
6. Sign out/in FaceTime & iMessages on both iPhone & Mac
BOOM! What a nightmare and miracle.
Thank you everyone in this thread.