In 4- to 5-quart Dutch oven cook potatoes and onion in hot butter over medium heat for 3 to 5 minutes or until onions are tender but not brown, stirring occasionally. Add 6 cups broth; bring to boiling. Reduce heat. Simmer, covered, for 20 minutes or until potatoes are tender.
Stir in the watercress; return broth to simmering. Simmer, covered, for 3 to 5 minutes, until greens are tender. Remove soup from heat; cool 15 minutes. Stir in tarragon. Puree soup using immersion blender or in batches using a blender.
Stir wine or broth into soup; season with salt and pepper. Heat through over low heat. If desired, top servings with sour cream. Makes 8 side-dish servings.