I've noticed that on 10.1 (Series 7), with Accessibility -> Quick Actions turned ON, notifications are now completely dismissed. Previously, with this feature turned on, the double tap gesture removed notifications from the screen, but they still remained in the Notification Center with a red dot indicating they were unread. On 10.1, a double tap now completely removes incoming notifications.
This is, of course, how the new Double Tap feature is supposed to work, but not how Quick Actions worked in the past. I suppose this is Apple bringing everything into alignment. With this update, Quick Action feels nearly identical to Double Tap. I'm having a hard time finding scenarios where it differs.
Oh, and "Gestures" is now a main listing in the watch settings.