Do you have the seller's address from the details of your Paypal payment?
If so, that is where it should be sent.
As to how, and this is IMPORTANT, use a service that has Confirmation of Delivery (Signature on Delivery) if the value including postage was more than $250*.
However, you can also start an Item Not As Described case here:
http://resolutioncenter.ebay.ca/
This gets Paypal and eBay involved and may lead to a faster reaction. If the seller does not refund, PP will and go after him for the money.
Two other notes:
If the watch came from overseas, it will be very expensive to return it with Delivery Confirmation. But if you don't use it, you will have neither your money nor your watch.
If the watch was sent from the USA under the Global Shipping Program, definitely start with the INAD case, because you will get the money back, without having to return the unwanted item.
Since it would be unethical to keep both the item and the money, you can trash or donate the watch.
*This changed recently, but I'm conservative on these matters.
