dictation will stop abruptly at exactly 1 minute of recording
Believe it has only been since the watchOS 8.1 update and the changes to the app layout to two step dictation. I used to take much longer notes.
The other platforms (iPhone, iPad, Mac) which Drafts runs on have a dictation interface that defeats the timeout for dictation the system imposes, but that has never been available on Apple Watch. There is a limit on dictation time - which is not published by Apple, and has varied some over the years, but seems to be between 45-60 seconds.
I’ve never been aware of Apple Watch allowing you to dictate longer than that, and the APIs Drafts uses to defeat that timeout on other platforms are not available on Apple Watch, so that feature cannot be replicated.
I would not expect that to change, as dictation is a rather battery and memory intensive operation, and Apple is likely to continue to try to keep strict controls on it to prevent running down the Watch’s limited resources.
If you have a need for longer dictation sessions, the Watch is probably not your go-to device and you might be better off using your phone.