[The Saucepan Man]

I think that there is already a thread on the video games. But since you asked ...

I haven't got past Balin's Tomb myself yet. But to beat the Watcher (as Aragorn), you wade out into the water, parry the tentacles and then chop at them when you get a chance. Each time you sever a tentacle, the Watcher raises his head and you fire as many arrows into it as you can. After four or five times of doing this, it dies.