People tend to get hung up on the power constraints, but neither GPS nor cellular in a watch application need to be on all the time. Wifi is essentially on all the time and yet Apple allows this. BT is on all the time communicating with the phone, and Apple allows phone calls to be made under this arrangement which sucks the battery down to zero in less than 3 hours of continuous use.
So used sparingly, when essential to the task, GPS and cellular will be fine additions that won't necessarily impact the battery life in any significant way.
As someone else mentioned, the bigger issue with cellular is the SIM card and having a separate number. But with a built-in sim, and emergency access for SOS, that would be a big feature alone. My dogs GPS collar has built-in cellular for which I pay a low monthly fee. I can see Apple making an arrangement with the carriers to let the watch be an add-on feature when bought with a current iPhone plan. It still has its own unique "number" but it's transparent to the customer. That further explains why Apple would line up the watch to coincide with the release of the iPhone.
Add to that cellular helps quick lock GPS, And of course provides emergency services when out jogging without the phone, even if a customer can't make and receive full fledged calls initially.
