You're using it wrong. Watchlist was created as a replacement for show replies, largely because of this, and because you couldn't follow a thread without posting in it.
Watchlist has all the same features as show new replies, and more that are missing like this. Use it instead.
So......we untick the top box, click Do It on the parentheses pop up, and tick the fourth box....amirite?
And from then on just go to "Watchlist" and don't bother with "Show new replies...etc" ?
And then, if we are no longer interested in a thread, just remove it from our watchlist?