Thank you for the suggestion. I have already worked with Apple support and received the following suggestion that does work on occasion:
Backup your Apple Watch by Backing up your Iphone
Un-pair (not sure that is the correct term) the Apple Watch from your Apple Phone. (this will wipe out all data associated to the watch, all of your activity data, all of your "Awards", etc.)
Reset the phone and the watch
Turn off the phone and the watch
Turn on the phone and make sure all "apple watch" related apps are
A) Not running
B) Are deleted from the phone
Reset the Phone
Bring up the settings screen. Forget ALL bluetooth devices.
Reset the Phone.
Turn on you Apple Watch. Go through the whole pairing and set-up process again.
Cross you fingers (ok. that was my own add)
In my own experience, this worked the first time I did it. It also took about an hour. And it only fixed the issue for 4 days. I once had to perform this twice to fix the problem. I don't really think it is necessary to go through all this as I think the issue is in the internal tables of bluetooth devices and what "state" the watch AND the Iphone think the device is in. Forgetting the device on the phone and the watch while the watch and phone are communicating appears to help get things working again, but it is inconsistent.
The watch has some severe bluetooth software issues... it does not actually forget a device when you tell it to. It will bring up the exact device name after you have indicated the device should be forgotten. If you indicate a device should be forgotten, the bluetooth screen will show that is searching for devices. If you exit the bluetooth screen back to settings, and then go back into bluetooth, the device you told the watch to forget will be listed as not paired, even when the device in question isn't turned on.
Think your watch is in airplane mode? No, you can turn on Bluetooth with Airplane mode still on. So if you are on a plane, you might want to check during takeoff and landing. The fact Bluetooth can be turned on, but the watch still shows itself to be in Airplane mode also indicates the Apple coders are pretty clueless when it comes to the interaction of the watch's various sub-systems.
It gets worse, actually. The watch is so "desperate" to communicate with its phone that it will completely ignore bluetooth devices if it has been placed in Airplane mode (with bluetooth off) for an extended period of time or if you don't connect it to your phone after removing it from its overnight docking. If you are going on a hike without your phone, best make sure you let it talk to the phone before you leave, or you will rarely get the thing to work with your bluetooth devices once you get to the trailhead.
Have your bluetooth headphones connected to your phone and watch at the same time? If you make a WIFI phone call, the watch will disconnect your headphones from the call. The only way I have been able to use a headset on a WIFI phone call is to turn off bluetooth on the watch, regardless of whether the headset is paired to the watch or not. I would perhaps question the headphones, but I used them with a Samsung Note and my Iphone for quite some time with no issues. Only issues have been since I got the watch and things have gotten a LOT worse since the last update. (which they won't allow you to back out of).
Ah, see you got me started. No the genius guys cannot fix this crap. I don't know if it is a hardware/firmware/software issue, but I would be on the latter. The guys in Cupertino are too busy saving the world to concentrate on mundane stuff like fixing a $400 sinker for a fishing line....hey, I wonder if you could put a video of a minnow on the screen and get a hook attached to it. Might have a use for this thing after all.