Quick comment on why parents in Germany had to destroy them.. that wasn't just because of these specific watches, but part of a crackdown on a whole class of illegal surveilance devices - the watches were merely the tip of the festering boil. You'll recall in recent years Germany ALSO banned for example internet-connected dolls.The legal reasoning behind it is pretty straightforward: You're not allowed to buy/own devices that can be used to transmit audio or video data AND that look like ordinary household devices. No wifi spycams hidden in alarm clocks, no voice-activated dolls, no snooping wristwatches. And it's not merely using them that's banned - possessing them is also illegal. If you try to import them from China and get caught, it can get pretty expensive. Hence people were told to smash them if they already have them at home (and then dispose of the remains in an environmentally friendly way) - it's the only way to get rid of them, you can't just flog them on Ebay to some unsuspecting punter.
The security flaws involve iLnkP2P, software developed by China-based Shenzhen Yunni Technology. iLnkP2p is bundled with millions of Internet of Things (IoT) devices, including security cameras and Webcams, baby monitors, smart doorbells, and digital video recorders.