Currently if some system error occurs then the complete PlanetPress Watch stops. It would be good if the current process which had error ends and then continues with the rest of the process/files.

There are several options that allow you to accomplish that in the On Error tab of components and processes.

See this online help page for more information

In my workflow inside On Error i have selected either Default or Stop Branch as Action. In case of errors like "A call to an OS function failed" it stops the complete PlanetPress Service. How do I make sure it does not happen. What action does Default do?

That usually signals an issue with the PC itself. Given that you've been having problems when running more than 7 replicated processes (which is what you said in a private message), I would definitely think the hardware is at fault (or perhaps there is an application running on the same server that uses up all the resources).

Open a call with our Support team, they will tell you where they believe the issue stems from.