I can't help feeling sad for what the charity didn't get out of this. I'm sure we all have a day dream of finding some treasure for nothing in a charity shop, car boot sale or similar. But if such a thing were to happen, based purely on the unwitting honesty of the vendor, wouldn't it be nice to at least share some of the loot? I mean, he knew, the person working in the charity shop thought it was just a dirty old watch with no strap, but at some point, someone donated that with the aim of its being sold for maximum benefit to charity.
Anyway, I guess this is the place to talk about watches rather than personal morality...and who can really say they wouldn't take it? I think the difference comes when you have the intention of turning it into cash as soon as possible: an eBay bargain is one thing, but dancing out of the charity shop as fast as you can feels a bit different.
Actually, mimo has a good point here. On reflection, if I'd sold it I like to think I'd have made a decent donation to the charity. If I'd have kept it then maybe likewise.