There's another conceivable possibility for the confusion ...
When you go to your Watched (threads) listing, all the checkboxes labeled should be unticked, whether or not a label 'Email' appears beside them. Here's why ...
The appearance of an 'Email' label beside a checkbox can be understandably interpreted as meaning the checkbox is strictly related to email notifications. However, this is a misinterpretation.
The 'Email' label is a separate interface component from the checkbox, and these two components cue you to two different things.
The checkbox is a persistent affordance that you can proactively use to signify selections for further action. If you select (check) one or more checkboxes, this cues the system these are the ones to be manipulated using the options in the drop-down menu to the lower right of the listing (entitled 'With selected').
The 'Email' label is a system cue flagging which of the checkboxes are associated with Watched items for which you've requested email notifications.
If you click on 'Select all', then choose 'Disable email notification', all the 'Email' labels / cues disappear. If you then 'Select all' and choose 'Enable email notification' the 'Email' labels appear again.
If you're seeing a mix of 'Email'-labeled and non-labeled checkboxes, this means some of your Watched threads are not designated for email notifications.
If you're only seeing 'Email'-labeled checkboxes, this means all your Watched threads are designated to issue email notifications, and any failure to receive them is most probably caused by something on your end (e.g., the Outlook / Office365 issue noted above).