All you need in this stage is to be able to fly over a high cliff. Use the following flying cheats:

Set 1: Wings
Set 2: Pegasus
Set 3: Plane

Kill the alligator by attacking. The alligator dies pretty easily by your sword. Make sure that you fight the crocodile up on the cliff, since it can be much harder to pick up the watch if it falls into the water.

Pick up the Watch.
Give to the Pirate.

Scribblenauts Remix 4-7 Cheats Hints gallery:
4-7-1-a: The Cap’n has lost his pocket watch! Help him find it again!
4-7-1-b: The watch isn’t inside a chest.
4-7-1-c: Is that crocodile ticking…?