Summary

There are some recipients you can select to send emails to in case you don't want to use a smart value. E.g. assignee:

Those recipients have automatic checks in place to check if the user selected in said field is active or not, which prevents Automation from sending emails to it:

The field Watchers is not an available option and as a consequence you need to use the smart value {{issue.watchers.emailAddress}} along with conditions to check if the users selected are active or not using the smart value {{issue.watchers.active}}.

Suggestion

Make it possible to select Watchers as the recipient for the Send Email action.