Android Wear emulator: "No longer connected to network"
It appears that this behavior occurs when you attach a different host device to pair with the emulator, for instance when switching between connecting two phones to your computer with pairing enabled.

The Android Wear app itself then displays the status of the emulator as "Trying to connect…" and the connection is refused between the emulator and the new device. The problem goes away once you've attached the original device that you first used with pairing to the emulator, or wiping data on the emulator and pairing it with the new device.