The Casio MP3-player/watch was the first watch to my knowledge that combined an MP3 player and a traditional and functional watch. It was actually one of the first things I acquired while in Akihabara in Tokyo! Since then (maybe 1999 or 2000), however, many other companies have been making MP3 player watches. And with little success. However, although I do not think I will ever buy one, TechnOtunes makes some very nice MP3 player watches. I would never guess that they have 256 MB internal memmory by their looks!
One of the more intersting aspects of the watches they manufacture is that they use a universal USB/headphone jack so the fact that the watch plays MP3s is even more discrete. And they have made a model for every type of consumer: the businessman, the teenage girl, the middle aged average joe, etc.!