The Championship's bottom club looked on course for just a fourth victory of the season when they were 2-0 up at the break thanks to goals from Andrea Orlandi and Steve Davies.
But a four-goal blitz in 14 minutes at the start of the second period had Watford firmly back in control.
Ighalo and then Troy Deeney brought the scores level before Ighalo and Matej Vydra made it 4-2 inside the hour mark.
Gabriele Angella added a fifth, Ighalo completed his hat-trick and then netted a fourth with nine minutes to go to complete another miserable day for Blackpool as Watford cemented their place in sixth.
Brentford moved to within two points of leaders Bournemouth with their 2-1 win at Norwich City, thanks to Jota Peleteiro and Alex Pritchard's penalty, either side of Nathan Redmond's equaliser.
Elsewhere, Conor Coady's strike eight minutes from time earned Huddersfield Town a 1-0 win at second-bottom Wigan Athletic, while Guy Luzon's first game in charge of Charlton Athletic ended in a goalless draw at Wolves.
