I can reply on all messages. I'm given a choice of pre-suggested responses (Yes, No, Can I call you later, absolutely, etc) or even context related responses if a question / choice was presented (ie "would you like sushi or pizza tonight?" will give me sushi and pizza as choices). Furthermore, you can also respond with emoticons or dictate a message via siri.
Look under the "messages" app settings on your iPhone Watch app. See if something looks off.
I can send and receive messages just fine, but I never get any context related responses to choose from......just the standard responses. Is anybody else experiencing this?