In the interest of avoiding anybody else making this mistake another non-development solution might be to better promote the Special:Preferences#mw-prefsection-watchlist section from the Special:Watchlist page. There are already links for Special:EditWatchlist, Special:EditWatchlist/raw and Special:EditWatchlist/clear on this page so an "Edit watchlist settings" link wouldn't be too amiss.
Seems reasonable to me... Would be worth filing as a separate task, and referencing this one though :)
Nov 19 2017
You did hit "show" after changing the value on Special:Watchlist? Just checking... As it does sound like there's some bug here...
Additionally, it appears the "Days to show in watchlist" configuration set in Special:Preferences takes precedent over the "Period of time to display" configuration set on Special:Watchlist which doesn't seem all that intuitive.
What do you mean takes precedent? Does changing "Period of time to display" not work if the preference is set to 0?
Nov 18 2017
I can confirm that setting the "Days to show in watchlist" to > 0 does make revisions display in the watchlist!
Just wanted to bump this ticket as I'm still having the same issue. I would appreciate it if I could get some feedback on resolving this.
Sep 21 2017
Approximately how many entries does your watchlist have? ("Raw watchlist" might display that).