If Apple were to indeed release an 'iWatch' smart watch I would be interested to see the pricing considering they will most likely be releasing a phone with plastic back for a lower price range. To make the watch sell they would have to have impressive battery life and features which would mean it could function as a lone device. Surely this would mean that people who wanted a smallish IOS device would just buy the iPhone C if it isn't much more? More over wouldn't this also jeopardise the iPod Nano and possibly cut other iPod lines sales? Either the watch will have no separate functionality and risk not selling well, or it will have this functionality but will have a higher price range to avoid cutting iPod sales.
The iPod line is still a strong, but declining, product category for Apple. I imagine they have no problem cannibalizing ipod nano sales if it means the sale of their iWatch.
Think of how they pre-emptively cannibalized Mac sales with the iPad. So long as you are the first to do it well, it works out OK.
But, if this samsung watch is $299, how cheap can the iWatch really be? Probably not far off from that. Unfortunately.