There are cheaper reset chips available that doesn't have any watchdog functionality.

Just make sure that you get a reset chip indended for active high reset, since most processors are using active low reset.

The voltage regulator should have two smaller-valued caps since they are optimized for the regulation loop speed the regulator have. Besides that, you may have a larger capacitor on the input side together with the rectifier (if you power with AC) and a larger cap on the inside.

Note that making the inside cap too large can result in some problems because:
1) it represents a very large load when powering up, and if you have a voltage regulator with current limiting, then you get a RC circuit where the voltage slowly increases until the cap is full and the voltage regulator only needs to power your actual circuit.
2) it represents lots of stored energy, making the supply voltages slowly decrease when you remove external power. This is extra troublesome when you have a design with RC reset since it is easier to remove the external coord for just so long that the voltage drops below safe operation for the processor, but not low enough that your reset circuit produces a proper reset of required minimum length.
3) huge capacitances on the inside also represents lots of short-circuit power (depending on inner resistance) in case you do something you shouldn't have done. Way more current are available than the 7805 alone may supply.