Take a look in the apm and see if there is still a "reload" link available even though the file is being watched. If you have a syntax error in a tcl file, or an xml error in an xql file, then the watch proc is not able to parse it, and the old version stays live.
That was it! Thank you very much. That complex query now is working perfectly, and although it is expensive (slow) it gets the job done, which is what I need right now.