I GOT IT TO WORK! Thanks to baba19981 on the Apple Support forums for posting this solution.
1. Unpair and repair watch. You should be able to restore it from a backup. Make sure your native apps are already on the watch.
2. Delete all Music from Settings > General > Storage & iCloud Usage> Manage Storage > Music > Edit > Delete all songs
3. Make an iCloud Back Up
4. Make an iTunes Encrypted Back Up (During this step was when I noticed that the apps were working)
5. Sync to iTunes to get your music back.
I didn't lose any data and all of my native apps are working, even after syncing to get my music back on my phone. I cannot believe this actually did it.
1. Unpair and repair watch. You should be able to restore it from a backup. Make sure your native apps are already on the watch.
2. Delete all Music from Settings > General > Storage & iCloud Usage> Manage Storage > Music > Edit > Delete all songs
3. Make an iCloud Back Up
4. Make an iTunes Encrypted Back Up (During this step was when I noticed that the apps were working)
5. Sync to iTunes to get your music back.
I didn't lose any data and all of my native apps are working, even after syncing to get my music back on my phone. I cannot believe this actually did it.