Steve, Watco is designed to be applied and then wiped dry after letting it set for 15-20 minutes. If it is applied over an already sealed surface, the finish will not penetrate the sealed surface and it will remain on top of the surface. When the excess is wiped off, little to no Watco will remain. So what has been accomplished?
To see that Watco does not "dry" to a hard finish, just apply some onto a non-porous surface and let it set for a day or so. After that time give it the thumbnail test. You will see it is quite soft.
It's really not much of a finish. It's about 75% thinner. The balance is made up of raw linseed oil, vegetable oil and a small amount of a resin.