Watchman has been the only spec I've played and I have no complaints and think it can be used in both PvP and PvE. Yesterday evening my guild finally cleared Firebrand and Stormcaller on 16-man NiM and my DPS for the pull was 1881 so the spec has the potential.I'd imagine that more skilled players than myself -- in terms of both actually playing and also theroycrafting -- are able to put up even better numbers.
Recently, however, I switched over to Combat for PvP as my guild is trying to run rateds on non-raid nights and it would seem that Watchman is slightly less valuable in these situations because our dots can be cleansed and the class lacks the burst of both Focus and Combat. To be sure, I pvp a fair bit -- just dinged v93 -- and I've never left a WZ thinking Watchman was non-viable but I have run only 30 or so ranked games so I'm not in the best position to comment on it's viability in certain types of matches.
Although I'm still getting a handle on Combat's mechanics and optimal rotation, I will note that the damage from Precision->Master Strike->Blade Storm->Dispatch is phenomenal. Although I have had plenty of long, heal fest WZ matches where I'll finish with ~800k dmg, it still seems so strange to me that I can do so much dmg in such a short period of time. As well, the extra speed w/ Trans is definitely noticeable and it's nice to be able to break roots with Force Camo. I do, however, miss the elimination of a min range for leap and the reduction of the interrupt c/d as those are quite useful in locking down healers. I suppose a potential riposte, however, would be that there is less need to lock them down when you can simply burst them down. I still need to work on the rotation outside of this series of attacks as my sustained dps with Combat is still pretty low -- which is why I still use Watchman in PvE -- but I think this shortcoming is attributable to player error rather than inherent limitations of the spec.
As someone who has recently started playing Combat, I will note that one of the biggest differences from Watchman is that I have to be much more focused on watching my buffs as it's important to determine whether Combat Trance is active. It's not problematic but it is different.
So, as others before me have noted, I think each class is 100% viable and which you choose will be determined by your playstyle and preference. Now that you have free re-specs, you have no excuse not to give it a try