Hi,
You could add a button next to the WaterMarkTexBox and through a command to set its
CurrentText or
Text property to null in order to clear it. If you want it to show on mouse hover you will need to edit the template of the control and add the according VisualStates. You could edit the template and the style of RadWaterMarkTextBox very easy in Blend Expression. Just drop a control on the design surface, right-click it and choose from the menu
Edit Template->Edit a Copy. Then Blend will generate all the needed resources and you could apply the required changes.
Hope this helps.
Regards,
Konstantina
the Telerik team