Delta_G:
No, it's a watchdog. It resets the board if you don't reset the timer before it runs out. If you put the code to reset the watchdog timer in some code that checks whatever parameters then you could let it kick a reset in response to some parameter. But normally a watchdog is just there to reset a hung up board, much like what you described in #41.
It's also not really intended to catch software glitches. It's more a safeguard to protect against the effects of line spikes or alpha particle hits on memory cells. Or, it should be.