I spent about an hour online with Apple Support Chat. That agent said that she had received zero reports of diminished battery life after the WatchOS update. She did an online test of the watch which found no problems. She had me call an agent up the line.
That agent also said that she was unaware of any reports of battery problems after the WatchOS update. She escalated the case to "Senior Apple Support". I've yet to hear from them.
Is it really possible that no one has contacted Apple Support about this issue?
I did finally hear from a more senior support person. She ran a remote battery test which showed what we already know. The battery health is OK (85%) but it is discharging abnormally fast. Unfortunately, their test does not pinpoint which app or process is causing the battery drain.
At that point she decided that since the watch is still covered by AppleCare+ she would have it replaced. She then put me on hold while she attempted contact with iCare, the local contract service agent. But, they only speak Thai and she only speaks English, so that was a bust.
Then she turned the call over to an engineer. He had apparently read the two test results in detail and concluded that it could not be a hardware problem. Everything on the watch (sensors, display, buttons, battery, etc.) was operating normally. So, it must be software.
He asked that we unpair the watch and then set it up as a new watch in order to avoid restoring from backup. He advised that after doing so we needed to wait a day or two (until syncing with the watch concluded) before knowing whether or not that solved the problem. If not, he give me a link I could use to resume the support session.
As of this morning, the results are not great. At 5:00 AM the watch was at 100%. Now, at 6:30 AM it is down to 82%.
We'll give it another day or so to finish syncing with the iPhone.