It is just implemented that way.. nothing is stored on your phone, eveything (data, settings) is stored in the Connect 'cloud' so the app needs a working connection all the time. I don't like this implementation at all, but it is just the way things are. The only settings you can change while offline are the ones that can be changed directly on the watch.
It's poorly implemented, if that's so. I have reset the watch and all apps, widget and settings were deleted but not restored. So the online connection and storage is, yet again, useless. So how can I reset watch and have a restore apps, widgets and settings option? Because I could not restore them, I had to manually add each app, widget and redo all settings. ​​​