Watson headed back to rejoin the Test squad in India on Monday, saying he's had a "very good week" and been able to nut out a few things with Arthur and Howard.
The allrounder was one of four players suspended from the current third Test in Mohali, and returned home to Sydney in time for the birth of his baby son Will last Thursday.
When leaving India early last week, a clearly disgruntled Watson declared he would reconsider his Test future.
It fuelled more speculation of a rift between Watson and skipper Michael Clarke, which was intensified by Howard's description of Watson being a team man only "sometimes".
Watson, who is aiming to return for the fourth Test in Delhi starting on Friday, said he was able to clear the air with Howard and Arthur.
"It's been a very interesting week really. The most amazing week of my life with the birth of my little boy," Watson said at Sydney Airport on Monday.
"... Then with the cricket side of things it's been an intense week, but a very good week.
"It's been great to be able to actually have a few very good chats with Pat Howard.
"Some constructive chats about the way we are going to move forward, because it's so important for us to make sure we're on the same page.
"... I've also had, one in particular, great chat with Mickey Arthur as well.
"It's just been really good to nut out a few things."
Watson thanked Arthur and Clarke for "how unbelievably compassionate they were" to allow him to fly home after being dropped for not supplying required feedback on how the team could improve after going 2-0 down in the series.
"(I want to thank them for having) ... the kindness in their hearts to allow me to come home and experience the birth of my little boy," he said.
"It wasn't the ideal time, that's for sure. It would have been better for me to be there in the team environment, there's no doubt about that."
Watson was originally expected to return home after the third Test and miss the fourth Test, but his standing down over the homework-gate affair proved a blessing in disguise.
Watson said the only reason he returned to Australia was for the birth of his child.
While not backing away from his initial comments that his sacking was "extremely harsh", Watson did however admit it was a tough time.
"There was a lot of different emotions running through my head at that time," Watson said.
"It's nice things have panned out the way they have ... I'm really excited to get back on the plane and back in the team."