I haven't had any issues with 1Password on my Apple Watch. Except for slight pin entry latency (which is to be expected with WatchKit apps), it works pretty smoothly and doesn't take long to load. No crashes yet. No glitches.
What is the pin timeout on the watch? What are the possible consequences for not setting a pin on the watch and just letting the passwords be protected by the built-in pin?
It's VERY convenient to have one-time passwords (and a couple other frequently used passwords) on my wrist. It will be even better once you have access to a full SDK and no longer have to deal with latency.