It's not what or whether they were watching, it's how they were watching. It's a judgement call but pretty easy to tell if a group is leering or just watching friends have fun.
Yes, that's what is being implied, and it's certainly something that happens, in degrees. People generally enjoy attention from those they themselves find attractive - obviously up to a limit, but that limit is much different than when you don't find the other person attractive.
And that is why the "making a woman feel uncomfortable constitutes sexual harassment" standard is problematic. And of course it's not entirely wrong either because it certainly can be done on purpose.
