Widevine L1 does in fact watermark the decrypted bitstream. I don't think it's still true today, but there was a period last year where releasing decrypted L1 content without re-encoding meant sacrificing an NVIDIA Shield. The Shield was the only L1 capable player which had a known weakness and Widevine would revoke the device key based on the watermark in the bitstream.
Nowadays the piracy groups seem to have found a way around this. Presumably they found a way to strip the watermark, but we can only speculate as the groups guard their methods closely for obvious reasons.
Nowadays the piracy groups seem to have found a way around this. Presumably they found a way to strip the watermark, but we can only speculate as the groups guard their methods closely for obvious reasons.