Brandon, you are right. I can only vote for my situation :D
In fact the best thing I ever programmed is having your simple "Watched Content" list above the forums. To be fair, it just puts *any* information from the script usercp.php and displays it completely like that on the top of all forums. That easy, and that powerful.
That increased user traffic a lot - as you might think.
Important is that the user knows there is something new, and he interacts as fast as possible. Having 50 participants online within a five minute period is different than having 50 participants coming on any time in the day and look if something is new. Therefore the notification system (be it an email system - I activated that by default, or the Watched Items list).
I do like very much that IPB has Watched Items as standard - the other forum software does not have it!