Burton was hyped as an odds on bet to succeed Ian Butterworth but in the end turned out to be a non runner.
"I'm flattered that Cardiff City approached me, I have a lot of respect for Lennie Lawrence and Sam Hammam," Burton told the Echo. "Watford want me to stay and that's as far as it goes."
The new favourite to be Lennie's assistant is City's reserve team coach Paul Wilkinson. He took the reserves to the South West area league title last year and his team has won their opening two fixtures this season.