Yes, that is exactly what I want to do. But why is the music then coming from the Watch and not from the phone? The Watch could serve simply as the control device while the music is streamed from the phone via Bluetooth. I REALLY hope that scenario will work, as that is one of my top 5 use cases for the Watch.
I think you will be able to do either one. The Watch actually has storage (8GB i believe) that you can upload your music to and use it without the phone connected. So if you want to go on a run without needing to carry your iPhone you can still listen to music with the Apple Watch streaming to your bluetooth headphones.