Hi John,
The only Edward Waterson son of Henry on the IGI, of around the right age, is bapt 30 Oct. 1803 Malew, son of Henry WATERSON & Esther KENNAGH. Their possible marriage 11 April 1803 Malew (needs checking in the original reg.). Second son William bapt 2 Aug. 1812 Malew (big gap - might be some missing? The IGI records have been messed around with by someone researching the family, and some of the original records extracted from the par reg have been wiped in favour of the church member's record - who has also entered duplicate entries with wrong years).
I don't have Malew parish registers, sorry, but the LDS film number is 0106730 for 1705-1804 and 0106731 for 1800-1848. Can be ordered to view for a small fee at any LDS Family History centre (under Church of Jesus Christ of Latter Day Saints in the phone book, and open to all, with many free indexes etc. available on the spot).
The full list for Malew is:
Christenings 1650-1705 FHL BRITISH Film 106729
Christenings 1706-1804 Marriages 1650-1757 Burials 1649-1787 FHL BRITISH Film 106730
Christenings 1804-1848 Marriages 1784-1830 FHL BRITISH Film 106731
Marriages 1788-1848 Burials 1788-1849 Index to christening, marriages 1784-1849 FHL BRITISH Film 106732
Christening, marriages, burials 1849-1883 FHL BRITISH Film 106192
Brian Lawson's website has the burial of a Henry W.: WATTERSON, Henry [aged] 80 Mal 29 Nov 1857. And: WATTERSON, Esther [aged] 66 Mal 25 Oct 1840. http://www.lawsons.ca/burials/watt_01.html
The only Henry Waterson I can find in the Malew 1851 census of around the right age has his birthplace as Arbory - Widr., aged 73, but he gives his occupation as Ag. Lab. which is wrong according to Edw's marriage (unless Henry had become too old to go to sea?), living at 6 Queen Hithe? St., Castletown, with his daur Ellen Unm., aged 40, b.Castletown, and grandchildren William Unm., 19, Ostler; Elizabeth 16; John 8; Catherine 4; all Watterson, and all b.Castletown, Malew.
Someone who knows this part of the Island better than I do might be able to offer more suggestions. Or a M.I.?
Sue