Kalman filter in GPS watches
The usual case (as of Nov 2016) is a barometer but no inertial sensor in wrist-worn devices.

MEMS sensors are being worked on, f.e. Invensense has introduced a miniaturized sensor platform for wrist-worn devices recently. I do not know any products that already use this.

One thing to be expected from inertial sensors is extended battery life, because the GNSS receiver can be powered down more often. Aiding the tracking loop with acceleration stress and jerks is typically not relevant for wearables (unless you take them for a roller coaster ride).