In a single server configuration we are allowed to configured SQL server express instance so by default purchasing of the MS SQL is not required for the Datawatch server installation. Datawatch Server installation does not place meta data into the database, it only places some model, project, workspaces and other binary objects into the Datawatch Server library.
In most of the cases SQL express should be sufficient and in that case it is not required to purchase a license.
If there is overtime increase in a use of the database stored objects, processes, schedules it might lead to the database size increase and you might have to consider that SQL express has a size limit of 10 GB for the database size.
I hope it helps, Let us know if you have further questions.