I say contact apple support via a live chat or phone call. Sounds like the sensors on the touch screen are malfunctioning. If you have apple care they should be able to help. If not, a fee may be required. From there you can do a mail-in repair. If you live near an Apple store that would be the best option though.
When I put the watch on the charger the screen scrolls and won’t charge. When I take it off the charger I can’t scroll with the crown yet it turns.
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Question: Apple Watch Digital Crown not functioning. It scrolls without turning the crown while on the charger and wont scroll while off the charger.