Keep everything documented because that is your proof. Go to sites like MouthShut.com to publish your story. Explain it well and then inform eBay about this. The negative PR would hopefully make them realize something.
Try to have all your communication through email as that can serve as proof. You should also have the proof that you have delivered the watch back to the seller.
If this money matters to you a lot or if it is about principle, don't be afraid to go to consumer court. Again, documentation is important.
Note - Only go forward if you are telling the truth here.