Google has changed the kill API that the task killers use. In 2.2(Froyo), the kill API now just restarts the app. It will come right back, under a new system process. This fits quite nicely with Watchdog. If an app was stuck in a bad state, or was performing some strange work in the background, a restart will "reset" the app back to its initial state.
Before 2.2, killing an app would destroy the app's scheduled jobs, and services, leaving it useless. If you killed Astrid, you'd receive no notifications for it, and might forget to pay that parking ticket. Kill Twitter, and you won't be notified about new tweets.
This is wonderful news, and it doesn't affect Watchdog at all. Watchdog's primary use is to alert the user about applications that are consuming CPU. Task killers try to do the same thing by killing everything, hoping they get the misbehaving app(even if there isn't one). Now that the kill function just restarts the app, killing tasks is mostly pointless. A task killer can kill an app all day, but it will restart normally. And if that app starts again to eat CPU, how will you know? Watchdog will tell you about the app, and if it is truly broken, you can uninstall or send a bug report.