North American railroads ran on time, and after a series of collisions attributed to faulty timekeeping — the 1891 Kipton disaster is the famous catalyst — the roads imposed formal watch standards administered by time service inspectors, of whom Webb C. Ball became the best known.
The mature standard, as codified by various roads in the 1890s and after, typically required: an open-face case, size 16 or 18, a minimum of 17 jewels, adjustment to temperature and positions, a lever escapement, a plain white dial with bold Arabic figures, and lever setting on many roads so the time could not be changed accidentally by knocking the crown.
The standard was enforced, not aspirational. Watches were submitted for inspection, carried on an approved list, and re-checked on a schedule — often fortnightly comparison against a standard clock, with records kept. A watch that drifted beyond tolerance came off service until regulated.
This explains the railroad watch's characteristic look: everything about it — the legible dial, the lever setting, the high-grade adjusted movement — is a compliance feature. It also explains why 'railroad grade' is a claim that can be checked: the approved lists survive, and a watch either meets the published requirements of a given road and period or it does not.
For collectors, the caution is that 'railroad style' and 'railroad approved' are different things. Many fine watches looked the part without meeting or being submitted to any standard, and requirements differed between roads and changed over time — so the honest claim is always specific: which road's standard, which period, and on what evidence.