I use a Nikon DSLR D70s with the kit 18-70mm lens together with a x2 magnifying lens that I can screw ontop of the 18-70. I also have a small
Nikon Coolpix L3 which has a Macro function and takes great pictures too.
IMO the secret to nice photographs is diffused light! Make sure only diffused light reaches the object and use a tripod.
For some of my shots I put the watch on a white cloth in a plastic container:
The paper in front of the container is important to prevent reflections of the room in the shiny parts of the bezel.
Cloth will work too instead of paper:
Be sure to position the watch in such a way that the lens wont reflect in the bezel or other parts of the watch (or erase the reflections
with PhotoShop or similar app.)
I also used another setup with paper (plain white copy-machine paper):
The setup in the lower left corner differs from the one at the lower right corner in that in the latter more light gets to the subject. I added the towel to dampen the shake the camera experiences when the mirror moves upward.
Overhead this setup there are two tubelights (2 meter in total).
Really, thats all (and a little postprocessing of course