My sleep mode has also gone to 2 step instead of one. But... more important it does not seem to go into sleep mode. Before it changed the way the time showed and would not show time unless you pushed a button. Now it looks same as daytime and lights up when I roll over, also will often start beeping during the night waking me and my spouse up. I most nights end up taking it off and putting it on the charger. What happened to sleep mode that does not disturb?
Could it be that, after selecting "Sleep" in that new, annoyingly unnecessary Modes selection menu, and during that new, annoyingly unnecessary vanity animation for the Sleep mode activation, you pressed the Home button or otherwise excited said animation?
According to my observations, it seems that the Sleep mode does not get activated if you don't let Samsung bully you into bearing with that animation for long enough. If you exit the animation too soon because, say, you want to get on with your life and set an alarm or whatever without having your life-time wasted, the watch sporadically seems to count that as aborting the whole activation altogether. So, no Sleep mode for the impatient.
I can only wonder about this really, really bad and user-unfriendly design and UX decision, but hey. Because of this and other issues since the update, I will not spend another dime on any Samsung watch. I will simply look it for another vendor once I decide it's time for a new device. So, great move, Samsung! Way to go!