Am I missing something, or if you watch threads do you have no idea if any activity has taken place on them? I have four threads watched here, so I can see if we find solutions to some problems I'm having - but each time I go in I have to click on each one to see if there's a new post. Is there any way the watch list can indicate who made a recent post to the thread, so I know if it's worth checking them?

Do you mean the post icon does not show as new post?
When you visit that forum?

I believe the feature emails you when there is activity; but i think you need the option to recieve email turned on, or for the thread to mail you when its been updated (i believe that's in the watched topics page)

in that email, it would be nice if it only emailed you once, rather than everytime a post is made.

If you visit the thread, then it would then email you again, once another new post is made.

I get probably 500+ emails a day (not including spam) so I try not to do anything that generates even more email. I actively try to remove a few lists every day, to cut my load down.

I forgot that most forums have just a default "lit up" image meaning new posts - my users always found that a little too obscure for them. Anything that requires a new user to "learn the system" is a barrier to having them enjoy the forum. On my forum, the icon says "new posts"

So, my fault for not seeing the lit-up image.

lol, nice idea