I changed the watermark image in admin. It is applied for both the default and site level. The magento watermark still applies even after clearing cache. What could be the reason for it?
Many people confuse
Product Image Watermarks with
Product Image Placeholders.
Product Image Watermarks can be changed from
System > Configuration > Design > Product Image Watermarks
Product Image Placeholders can be changed from
System > Configuration > Catalog > Product Image Placeholders
Check this folder as well to make sure its clear: media/catalog/product/cache/