It appears that having the watchdog package installed caused eventlet to hang while starting a Flask/Flask-SocketIO server.

I am not referencing this package in the source code for the server. It's only installed for another process.

Turning off Flask debug in socketio.run allows the server to start.
Not calling eventlet.monkey_patch() allows the server to start.
Uninstalling watchdog allows the server to start.

I don't know how watchdog causes the issue, and I'm totally unsure of where to report such a defect. In theory, if the defect is simple, anybody with a Flask/Flask-SocketIO server using eventlet can install watchdog and check for the same behaviour.

The behaviour is that the server locks, doesn't server requests, and doesn't reload. I suspect it's something with the file watching, since watchdog also watches files. But how it interferes, I don't know.