Not an unreasonable number
I even think that there could be a market for more. The article states 40 MiP sold last quarter, each wanting a companion watch. There will be more sold in the almost quarter to come until Watch release and having a new iPhone without a new iWatch is like putting Romanian remould tyres on your Porsche Panamera or buying a pair of Louis Vuitton shoes and wearing ASDA Smart Price tights with them.
You just have to have it.
And here's the good thing: While it shows that you are a modern, sophisticated, successful, beautiful and knowledgeable person, it can hide the fact that you only have iPhone 5C in your pocket, because your contract didn't allow upgrading on iDay. A Ferrari keyring on your Fiat key.
So, the 40M plus the new Apple customers on Black Friday and after christmas plus the up-pretenders sounds very reasonable to have a 50M initial stock. It might just be out of general goodness to God-Bless-America to have, for a change, enough stock for the demand to avoid city centre riots and these unsightly shanty towns trailing away from the Apple stores for weeks.
Apple Watch is, again, a very cleverly marketed and priced trinket. Nobody needs it and everybody can afford it; let me clarify: there is no urgent use for this item, so your dislike slides off it, you can't reason for or against it on an objective basis, it becomes a matter of taste and fashion or mock-taste and mock-fashion. Any argument about it will be emotional, and emotional arguments against something usually only harden the resolves of the parties involved.
The price point is cleverly honed to peak impact: the most expensive that everyone can immediately deal with. 350 VMD is your utilities bills(water, gas, leccy, comms) bounced for a month, plus cutting the food down to staples. And, hey presto, you're a $positive_property person.
Just my personal opinion, don't take it serious . . .