I've had my Galaxy Watch 7 for a week and the weather complication never updates unless I manually refresh the weather in the weather app on my watch. I never had this issue on my Galaxy Watch 6 so this must be a new bug with One UI 6. 

If it helps I have location permission set to always on for both the weather app on my watch and my wearable app on my phone. I have automatic refreshing set to every hour. I'm using this watch with a Google Pixel 8 so I wonder if this bug is only with non Galaxy phones as it doesn't seem widely reported.