Does SpO2 tracking improve sleep tracking?

As DMar has mentioned, SpO2 does not result in an improved sleep tracking. For sleep tracking, make sure your watch is not in Battery Saver mode (battery saver mode disables HR and much more). Also make sure your watch has a snug fit. Some people may like it tighter, but that is up to you. But don't leave it loose, that can result in frequent movements and the watch may detect that as movements during sleep. You have to experiment a little for that. I have worn in tight and then in a comfortable position (a snug fit) and both the results were near identical to me. Having a loose fit is definitely a bad idea. Also, make sure there is no moisturizer or any other night cream or anything below the watch skin. If you want the area under the watch to breathe, shift your watch to the other hand while sleeping (change it in Garmin connect app too). 

You said the sleep tracking is far from great. Might I ask in what sense? Like it shows poor score or poor HRV or less time slept, etc.?

Thanks for the hink. Sleep tracking mostly never detects when I'm awake during the nigh.

The funnies situation happend yesterday: According to the watch I slept till 07 something and last hour or two I had REM sleep. However, in reality I waked up at 5:00 did morning routing, went 2 floors down to a garage, drove my son to a trail station, drove back, walked 2 floors up, ate a breakfast - all that before 7:00. All that was registered as REM sleep.

Bonjour Gregory, comme quoi le suivi du sommeil est loin d'être juste.

Hello Gregory, sleep tracking is far from right.

Woah, that's really strange. Have a look at this link and make sure you have set the proper sleep timing window and have met all the requirements.

If you have time, I would suggest reading it entirely, if not, at least read the section titled: What are the requirements to take advantage of this feature"

https://support.garmin.com/en-US/?faq=mBRMf4ks7XAQ03qtsbI8J6

When I wake up earlier than my sleep window, I usually long press the Start button and end Sleep mode, if not Pulse Ox and a different watch face (if enabled) would be on.

A error of few minutes is generally acceptable, but if you woke up at 5 AM and it shows REM until 7 AM, then that is definitely a huge error. Read the link and give a try and if everything is already set as per the link, I would suggest contacting Garmin for other options. My idea is to reset your watch once, to make sure the software is without bugs and if it doesn't work after that, contact Garmin and get your watch repaired or replaced. I have been using the Venu 3 since November, and so far I have not encountered this error. It even detects accurately, the 2 minutes I woke in between my sleep to use the restroom. Granted, a few minutes error is possible, but again 2 hours, is impossible haha.

On the other hand, I hope  you don't have any tattoo's on your arm, that can interfere and give erroneous results. 

Are you having the same issue as Gregory? Pulse Ox can be inaccurate, but sleep tracking is more or less accurate for me. On days when I am on medication, for example anti-biotics for Flu or such cases, yes the sleep tracking becomes bad because of high stress. But on normal days, it is more or less within the error range. Again, I have nothing to compare my data with, but based on what I feel, it seems to be okay. Kindly let me know what issue are you facing.

Thanks for the link - will check it. My sleep timing is set from 21:30 till 06:30 and 99.9% of the days I wake up at 6:00. Usually, the duration of sleep is detected correctly. However, if I have a bad nigh and wake up in middle of the night and read my phone for half an hour or so - this is mostly never detected. As a result Garmin is strongly overestimates quality of my sleep.

The story I described happen only once, I'm not really worried about this.

I usually use fabric band - sits well and I do not have Tattoos.  

The sleep score is used to know the quality of your sleep and that is a altogether different discussion. Alcohol, medications, coffee, stress, many other factors contribute to sleep score. Maybe I should try waking up at middle of night haha and check if my watch detects it. Yeah, I use the Garmin Nylon band too. Great to know it is a one time issue, but if it occurs again, maybe a reset will help you. In most cases it is the software issue.