Watermarking
 

I have created a watermark and everything appears to be working fine but I noticed that when we changed the watermark from an initial test version, any photos that were viewed whilst the original watermark was in use now show with both. Is there any way of removing the one watermark?

No because the other water mark is part of the photo not an overlay :)

so it is not possible to ever change the design of a watermark then.

I thought that if you used on the fly watermarking, that it was an overlay?

If you use an on the fly watermark then yes an image is not permanently marked meaning in the future you can redesign your watermark and it will change on all photos