This old information solution for Gen 6.5 covers that LogWatNT.exe is run by the service "Event Log Watch" ("CA Licensing Event Log Management").
It suggests the service can be set to Manual after the installation.
From what I see in my Gen 8.6 environment when I stop the "Event Log Watch" service the LogWatNT.exe process is removed from the Task Manager Details tab, so that matches the above.
After disabling the "Event Log Watch" service, I tested renaming my license file "C:\Program Files (x86)\CA\SharedComponents\CA_LIC\ca.olf" and when I started the Toolset a CA_LIC error is still logged in the Windows Event Viewer under "Windows Logs > Application".
Therefore there appears to be no negative impact on the license checking with service "Event Log Watch" not running. So changing permissions on LogWatNT.exe or removing it altogether should in theory be OK. However you may want to log a support case for us to confirm that 100%.
Regards,
Lynn