I don't think the allure of Panerai has anything to do with the history of the brand, since a fascist military watch probably has limited appeal.
I don't think the popularity of these watches has anything to do with the mechanical movements, either, since Panerai hasn't got a longstanding tradition for great in-house movements.
I think these watches are primarily prized for the design. More cynically, I'd say they emerged at the right time to ride the big-watch trend, a trend that is primarily about making expensive watches conspicuous at a time when precious metals and gems were not in style. In other words, Panerai is coveted because it produces a small number of watches, which makes the brand exclusive, but Panerais are large and distinctive and can be spotted easily from across the room.
But Panerai was one of the first, if not the first, to market >40mm watches even before Richemont bought the company.
What i sthe appeal of Panerai watches? This i not a knock on them, as I understand people like things for different reasons. I personally don't understand why they are interesting or attractive or otherwise worthwhile. But there must be something to it. Or is it just that you either get it or you don't, and I don't?
The case design has very nice proportions, or at least the original one does. As a watch on a wrist I find them tremendously unappealing.
I got into Panerai in 2001. Even back then it was still a young brand but its appeal for me was its distinctive look, size and military history. Here's some Panerai I owned (some have since moved on).
Also got a Mare Nostrum 301/A.
And some strap craziness
But most importantly, Panerai introduced me to a whole new community of passionate people, the Paneristi. Here is an example of our nutty passion: brewing our own beer for a Paneristi gathering in Sydney
As for its history as a military tool watch. I love the irony of the dial with out minute intervals. Can you imagine this conversation? Commando 1: I have set the explosives. Commando 2: when will it go off? Commando 1: Oh in 5 or 10 minutes time. Its just so Italian
The big watch thing is OK by me... I recently looked at a Hamilton Khaki Automatic Officer's watch and really loved the way it looked... until I put it on my wrist.
I think the thing I really dislike about Pans are their seemingly ubiquitous crown guards, which seem rather ridiculous to me. I have seen quite a few examples in this thread to make me reconsider my thinking based on their lack of this feature, but I have seen few in stores without this ostentatious affectation.
I remember seeing one around 1991 at Tournou and thinking it was different and interesting and huge, but I came to think they are just too big and inelegant (though had I bough the first one a saw at $2,700 on a bracelet it would have been a great investment). The Black Seal is certainly my favorite, but if I wanted a big watch I'd go IWC pilot, Omega PO, or Zenith Grande Primero. I will admit that it really was Panerai that started the large watch trend almost single-handedly.
Panerai are perplexing watches. Under glass, they are unique and seem to be ideal for casual wear. However, their portentous size seems to complement a Bid Dudeeee rather than the average Joe (Plumber).