It should be noted that the Samsung Gear Live (one of the first two Android Wear devices from last June), as well as the Moto 360 both have a heart sensor, powered by an LED on the back of the device, just as Apple's will.

Note that a number of available smartwatches already have heartbeat sensors (Gear 2, Moto 360, LG G Watch R, etc). You didn't exclude this possibility, but just wanted to clarify for any who wondered.

Yea, I think the Fitbit style is the design they should shoot for. They could use the wrist band to hide precious IC space, along with the antenna for the GPS.