Managing a stopwatch mobile app
This is what I came up with (untested):

I got rid of your settings-stuff, introduced a variable self so there's no interference with this, moved your initialization code to the only place it is (and can ever be) called from, extracted a method for padding and event handler registration and fixed your updateTimer so it works for values > 1000 (it's not fit for negative values, though). I hope you like it...

(function (MyApp, $, undefined) {
    // Using strict mode to throw exceptions for 'unsafe' actions and coding patterns
    'use strict';

    function addClickHandlerToButton(buttonId, handler) {
        document.getElementById(buttonId).addEventListener('click', handler, false);
    }

    function padLeft(number) {
        number = +number;
        return (number &lt; 10 ? '0' : '') + Math.floor(number);
    }

    // Manages the stopwatch
    var stopwatch = (function(){
        var minutes = 0,
            seconds = 0,
            millis = 0,
            interval = 100,
            timerId = -1,
        displayTimer = function () {
            document.getElementById('stopwatch').innerHTML =
                padLeft(minutes) + ':' +
                padLeft(seconds) + ':' +
                Math.floor(millis);
        },

        updateTimer = function () {
            millis += interval;
            if (millis &gt;= 1000) {
                seconds += millis / 1000;
                millis %= 1000;
            }
            if (seconds &gt;= 60) {
                minutes += seconds / 60;
                seconds %= 60;
            }
            displayTimer();
        },

        pauseTimer = function () {
            window.clearInterval(timerId);
            timerId = -1;
        },

        startTimer = function () {
            if (timerId === -1) {
                timerId = window.setInterval(updateTimer, interval);
            }
        },

        resetTimer = function () {
            pauseTimer();
            millis = 0;
            seconds = 0;
            minutes = 0;
            displayTimer();
        };

        return function (startButton, pauseButton, resetButton) {
            addClickHandlerToButton(startButton, startTimer)
            addClickHandlerToButton(pauseButton, pauseTimer)
            addClickHandlerToButton(resetButton, stopTimer)
            displayTimer();
        };
    })();

    // PhoneGap, jQuery &amp; device is ready now -&gt; initialize
    $(document).on('deviceready', function() {
        stopwatch('startStopwatch', 'pauseStopwatch', 'resetStopwatch');
    });

}(window.MyApp = window.MyApp || {}, jQuery));


EDIT 1+2: updated the code to integrate suggestions from the comments by the OP and fix errors.