First thing’s first, the main component of the watch is going to be the screen.  Almost all functionality and features (interaction, battery life, display, notification style, etc.) will be dependent on what the screen is and how it works.  The main hobby stores I follow are Adafruit and SparkFun so below I’ve listed X different screens that I found and would be suitable given my constraints.  I also find a good portion of my electronics on eBay but most of the displays I found there were just cheap knock-offs of the Adafruit and SparkFun designs and I’d much rather get the main component of my project from a reputable source with lots of example code instead of a questionable one.  The displays I found also came with breakout boards which added 5-10mm to both dimensions so ultimately I think I’ll be using the screen dimensions as the final dimensions for the finished product.

Primary Criteria:

• 45x45mm
• Low Power – less than 50mA
• Greater than 1.25″ diagonal
• Easy to interface

Secondary Criteria:

• Color
• Touchscreen
• $40 or less

Adafruit:

• Monochrome 1.3″ 128×64 OLED graphic display
• Dimensions – 35×35 
• Power Consumption – 40mA average
• Interface – I2C or SPI with easy to use library
• Price – $25

• SHARP Memory Display Breakout – 1.3″ 96×96 Silver Monochrome
• Dimensions – 40x40mm
• Power Consumption – Nothing specific listed on the site, but after going through Sharp’s spec sheets it looks like power consumption stays under 5mA for constant updating and drops down to under 10uA for a static image.
• Interface – SPI with easy to use library
• Price – $40

SparkFun:

• Graphic LCD 84×48 – Nokia 5110
• Dimensions – 45x45mm
• Power Consumption – Under 5mA
• Interface – SPI with simple library
• Price – $10

• Serial Miniature LCD Module – 1.44″ 
• Dimensions – 43x31mm
• Power Consumption – 40mA average
• Interface – Serial
• Price – $32
• Bonus – SD card holder, onboard graphics processor

• Serial Miniature OLED Module – 1.5″
• Dimensions – 45.5×33.5mm
• Power Consumption – 40mA average
• Interface – Serial
• Price – $50
• Bonus – SD card holder, onboard graphics processor

• Serial Miniature OLED Module – 1.7″
• Dimensions – 52x36mm
• Power Consumption – 40mA average
• Interface – Serial
• Price – $60
• Bonus – SD card holder, onboard graphics processor

So I’m going to rule out the SparkFun modules right off the bat.  While the idea of getting a large screen with a built in microcontroller is appealing, I’m already going to be spending a lot of time figuring out how to program the watch and making the Android app so I’d rather just use an AVR chip since I’m familiar with them.  In addition, these modules are roughly $10 more than their dumb counterparts, whereas an AVR chip only costs a few dollars.  The Nokia module is also surplus and rather old so it might arrive in questionable condition and I’d rather future proof this watch as much as possible by making the most expensive component of the watch robust, futuristic, and nice to look at.