Your second sentence is a good point - it was a request from the government, not a demand.
All public transit was shut down. In Watertown specifically businesses were not allowed to open and anyone in a car was subject to being swarmed by heavily armed police and taken into questioning.
Edit: clarified the parts that were specifically about Watertown vs. Boston as a whole.
Citations? Examples?
That sounds very different from "not allowed to open".
Police chief saying: "We're asking everyone to shelter in place, no vehicle traffic is going to be allowed to travel in or out of Watertown, until further notice, no businesses are going to be allowed to be opened."
There was coverage of a few incidents of bystanders in cars or taxis being swarmed by cops but I haven't been able to google up any specific reporting on those incidents at the moment. Without trawling through all the live coverage it might be hard to track down.