I have given it quite a few more play throughs and I am definitely enjoying it. I won't say its superior or on par with that of Ghost Reveries, but I also wont say its a step back. Watershed has a bit of a different aim and direction, not totally different, make no mistake, this is not a new Opeth we're hearing, the death metal trends are still existent here. Its got some really fucking nice instrumental stuff, the keyboard and violin touches are fantastic. Mikael's vocals are pretty well refined if they couldn't get anymore better in the first place. I'd say the feel of the album falls somewhere between Deliverance and Damnation, the acoustics here I think are some of the best I've heard from the band, which are apparent in the tracks Porcelain Heart and Hessian Peel which are quickly becoming my favorites.
So yea, why I do prefer Opeth's more hard metal musical talent, this is another side to them I don't mind hearing as well. Practically anything from them never fails to impress.