I'd be good with a subtle watermark.

The worst I ever saw was with the first edition of Wookiee Groomer's comparing prints of the original and SE trilogy. I understand that he didn't want the project to be sold on eBay, but having a distracting watermark fade in and out every few minutes really didn't work. It was an interesting project, but that kept me from enjoying it.

Thankfully that changed by the next iteration of the project.

This approach does work for me:

http://www.fuzzymemories.tv/#videoclip-2759

It's not too obtrusive, and it's constant so it doesn't serve as an additional distraction.