I guess I'm talking to myself.

The only way I've figured out to do this specific transaction so far (and I'm not sure it will work) is as follows:

a) Exchange Diners points for Amazon gift certificates (5,000 points for $25)
b) Use Amazon gift certificates online to purchase Marshall Fields gift certificates (this is the part that should work, but until I try it, I'm not sure)
c) Use Fields GCs at the State Street store to purchase the watch (they are an authorized dealer). I could open a Fields charge account to get either 10% or 15% off the purchase, depending on the current promotion.

This yields a DC points value of about half a cent, and would take 350,000 DC points (or about 315,000 if I get the 10% discount). About the same value for points as a 36" Sony WEGA TV.

Any other suggestions?