When a set is given to the Inner Circle, we give it a good look over, try to make sure as many cards as possible are playable and as few cards as possible are abusive. Even so, certain combinations or facets of a card simply do not occur to us before the card appears on a patch. WotC has months to playtest, tweak, and fix any given set - we are pressed rather hard to release sets as soon as possible, and don't have the time to playtest everything anyway. A certain number of ridiculously good cards are bound to pass through unnoticed.
The Watch List contains such cards that have come to our attention as being too powerful. If said cards remain troublesome, they are errataed on the next patch. Past examples include Vampiric Ring from Ascension and Kledion, Illusionary City from Rebirth.Current Watch List (as of 12-1-02)