I keep hearing this repeated, but when I've ran tests on this in the past (ReadDirectoryChangesW is the name of the function, if I recall correctly) it was actually quite difficult to lose messages.
For normal user behavior you will rarely encounter a problem. But build systems tend to update/create files very quickly. If there was a workload which would break ReadDirectoryChanges, it would be this one.
Reading the code for Realize, he gets the directory watching facilities from https://github.com/fsnotify/fsnotify. That library seems to drop the 'buffer overflow, please reset your assumptions' message. So if it did happen, I don't think the user would have a good experience.
If you do ever depend on ReadDirectoryChanges, you do need to fallback to stat-ing files if you get an overflow. Otherwise, your milage may vary.
