I'm having the same issue it's greyed out, and I have been through all my settings and all permissions are allowed and I have even talked to Samsung support and a tech agent never figured it out claimed she would do some research and call me back in a few days the next day I get an email from her and she simply said "how is your Watch running ok" and she closed the case. I can't figure it out for the life of me. The Galaxy Watch 7 manager allows notifications, and the wearable app allows notifications within the wearable app for each individual app on my phone. I do get notifications, but they are extremely inconsistent. I, too, posted this question. I can say that when I ran a diagnostics check on my Galaxy Watch Ultra, the test came through the Galaxy Watch 7 Manager. So, what I think is going on is the Glaxy Watch 7 Manager, in my case, is responsible for notifications. Idk how it works for the Watch 6 or below. I know I can toggle on notifications for the Manager app, and I can toggle on notifications for each individual app within the wearable app. So, maybe the Wearable app itself doesn't handle the notifications in and of itself, but with its counterpart, the Galazy Watch 7 manager, in my case anyway. I would assume, but I am not sure if the 6 has like a Galaxy Watch 6 Manager app. 
