This is a definite Prime Directive episode. Like Insurrection, "Who Watches the Watchers?" features a Federation survey team that goofs and the exposure of its existence causes a huge problem.
Although visually perhaps the most notable thing about the episode is that it features primitive Vulcans (although the forehead ridges makes them seem like primitive Romulans, which is pretty much the same thing, but still). Although nothing relevant is made of this fact, it's still nice to see a little bit of continuity, the wider shadow of one of Star Trek's best known alien races once again being cast.
This is the one where Picard is mistaken for a god (it happens!) and to prove otherwise he allows himself to be shot by an arrow, an event that still stands as one of the more memorable pieces of action from the series. Yes, it's incredibly simple, but that's just the kind of show Next Generation was. For his efforts, Picard receives a tapestry that remains draped on the back of the chair in his ready room for the rest of the series.
Although not a true standout otherwise, "Who Watches" remains for me a signature episode from the early part of the third season. It can be a little annoying, because any time Star Trek features primitive aliens it tends to overdo it, especially when attempting to deal with matters like gods and advanced technology. The primitive aliens tend to cower, or react violently. It's always the same. Maybe that's how people really are. Maybe Star Trek just likes to simplify it. Still, fun to watch. The Vulcan (or Romulan) haircut is maintained by these guys, as if it somehow grows that way, although it's not neatly trimmed (because they're primitive!).
In this instance, no matter what you think of Insurrection (which is also similar to the seventh season episode "Homeward"), it's the better of the two to be considered here.
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Memory Alpha summary.