The watch comparison is an interesting one. The watch I actually use as a daily wear is a Huawei GT2 smart watch. Completely accurate and with an excellent health tracker, objectively it is vastly superior to any mechanical wristwatch with the exception of needing regular access to a charge point. For diving I use a Casio G Shock digital Frogman which in my personal opinion is the best dive watch made and pretty much a dive computer. But I also have several mechanical watches such as a Speedmaster Professional, Seamaster Professional master coaxial, Stowa flieger B dial, an old Strela chronograph (which I have spent far more on in servicing and renewing than it will ever be worth) and a rather lovely Blancpain 50 fathoms which is the most extravagant thing I have ever bought. Despite recognizing that my Huawei and Frogman are objectively much better I like the precision and artistry of good mechanical watches and the attention to detail. And yes, there is a pleasure in the heritage. No it's not about timekeeping but there is something wonderful about the skill and precision required to make a mechanical watch as accurate and functional as possible which gives me pleasure. They are not rational purchases but I don't care
I have a similar feeling about audio. I consider listening to music and my interest in audio gear to be related but separate hobbies/interests. For listening to music I honestly find gear to be relatively unimportant.I can listen to the music I love using my smart phone with a dongle and the AKG IEMs bundled with the Galaxy S10 my last employer issued to me and enjoy the music just as much as any other IEMs or headphones. I have some nice headphones and IEMs and yes they offer better SQ but in reality the difference it makes to musical enjoyment is minimal. For enjoying music the gear really isn't that important. However what that gear does offer is better design, materials, tactile feel and pride of ownership. My parallel hobby is an interest in classic Japanese hi-fi. Not because I am under any illusions it would measure as well as cheap modern alternatives but because for me there is a real joy in the mechanical construction, impeccable fit and finish, depth of craftsmanship and design effort and the satisfaction that comes with something built to such a standard. Which is why my indulgence is my classic Sony ES set up and why one day I'd like a classic Accuphase system. I wouldn't be buying it under any illusions about sound quality (as stated, I really don't think audio gear matters that much, I can enjoy music on soundbars and my gaming headset) but neither would it just be audio jewelry as it is the heritage, quality and craftsmanship I admire
So for me there is indeed a parallel between audio gear and watches and it is entirely possible to see expensive stuff for what it is (an unnecessary and expensive self-indulgence) while still having a passion for it. However I am really not particularly interested in modern high end hi-fi, I am perfectly happy with a smartphone, dongle and pretty much any IEM or headphones for listening to music.