sass --watch process is locking up my terminal window

This is under a Unix/Linux environment? Then try running your sass command in the background by appending the '&' (run-in-background) char.I.E.

sass --watch file.scss:file.css &

edit -- expand on what is possible for monitoring

The next level would be to make this independent of where it is started.

nohup sass --watch file.scss:file.css > ${logDir}/$(/bin/date +%Y%m%d.%H%M).sass_watch.log 2>&1 &

You can start sass --watch and close the window, it will keep running.Later on, if you need to check progress, you can use

tail -f ${logDir}/$(/bin/date +%Y%m%d.%H%M).sass_watch.log

To watch the current activity.

If you suspect something happened a while back, you can specify the # of lines to include in the 'scroll back', i.e.

tail -1000 -f ${logDir}/$(/bin/date +%Y%m%d.%H%M).sass_watch.log

Finally, you if your sass --watch supports some sort of time banding (stop after running 24 hrs, for example), you could make a crontab entry so you always have the --watch running AND you can always show your manager exactly what/when the system found.

edit crontab, add entry

01 00 * * * { sass --watch --time 24hrs file.scss:file.css ; } > ${logDir}/$(/bin/date +%Y%m%d.%H%M).sass_watch.log 2>&1 

Crontabs are a little tricky. If you get to the point you feel you can use them, better to read the man page, other on-line help, and if you get stuck, then post on http://unix.stackexchange.com to get help.

I hope this helps.