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It's so that you can easily find an item. If you go into your "cart", any watched item is below the cart area in a watched item area. It makes it very easy to bookmark or watch an item.

The watch list is simply a way to consolidate all items of interest in one spot (below your cart) for easier reference. (Basically a bookmark of sorts).

I use it to keep track of the guns on my "want" list

It's so that you can easily find an item. If you go into your "cart"

It basically bookmarks your favorite items (up to 20) in your cart for a later purchase or just to watch them.