After a few more hours I almost have it on my own. I got to the point that the model appears ingame but no texture. Any ideas on why I get checkerboads (will anyone even see this?)? I know it could be alot of things, ah well.

It's a horn and banner replacment: http://i.imgur.com/NjQLSFF.jpg?1
There is little to no tutorials on how to compile weapon models. I've been trying to find out how using Helljumper's older hat modeling tutorial and searching around elsewhere; after a few hours yesterday and a few today I'm calling it quits. I feel as if Valve is overdue for adding weapons to the beta import tool, but i'd like to get this uploaded now.
Maybe I should be asking this on a more active forum, but I've never been a member on any. First I'll just see how this goes.

The dark shading is just there to see your model's shape, but I think you might have some polygons marked as flat that shouldn't be in the first picture; either or it looks like you fixed it in the later. When unrapping try to make it simple shapes and make seams in the lesast noticable places. Not really much else to say.

Here's the set:
http://psteamcommunity.yuanyoumao.com/workshop/filedetails/?id=167501151

Ah I have the same problem since its all done though the alpha channel and there dosen't seam to be anyway to make the cube map, paintablity, translucientcy, phong mask, and maybe some other things though anything but the alpha channel. If you find out how please tell me!

In the importer you can set it to do so though the alpha channel in your tga file. Using your image editing software, go under channels and create a grayscale channel that is colored a gray or white (white is shinniest) for areas you want it to shine and black for areas you don't want it to shine. Name the channel "Alpha 1". Back on the importer, in edit vmt, after clicking the tab "cube map" and selecting anything but "none" (I like world cube map) you can then click the tab below it and select "base alpha" to make the alpha channel define what is reflective. I forget how to make parts transparent but it's probably though the alpha channel.

I don't know actually. I've never made a watch model to be honest, but I'd be willing to bet that its just how the bones are connected in TF2. Just rig your model to the correct bone in the same place the watch you decompiled is, then hope for the best? Maybe? Good luck.

They're not shown to other players. The spy's watch only appears on him in first person view. Also I didn't say, but you probably already knew: the watch models have the bones with them; you don't link your model to the bones of the class you're making it for when its not cosmetic.

In Steam/steamapps/team fortess 2 materials.gcf/models/weapons is where you can find all the weapon models. The watches are in v_models since they only appear in first person view. You can decompile them with the fixed MDL Decomplier the same way you do so with player models.