The work within admin has been completed on this in the feature/watermarked-images branch, however there was one area that needed some consideration.
For the images to be watermarked on the front end, a new endpoint in darkroom-api is required. This endpoint would also be required so that permanently watermarking an image would replace the existing image with a watermarked one.
They have provided code which has been styled themselves, which is currently within master as an admin widget cxenseRecommended. I've been in contact with Andy Kelly (andykellydk on Skype) regarding next steps, which is allowing them to index the whole site, and also them creating another widget for the site. I can make an introduction via email, Andy is the best person to discuss next steps with.