I want to make a watermellon cake for a friend. If I make a white cake and add in some watermellon jello... will that make it taste like watermellon? What if I added some watermellon juice or crushed watermellon from a real watermellon?

You might be able to pick up some LorAnn watermelon oil at Hobby Lobby or Wal-Mart:

https://www.lorannoils.com/p-8695-watermelon-flavor.aspx

If you can't find that, I would use watermelon Kool-Aid (unsweetened) for flavoring. I found that adding Jello made the cake TOO sweet and didn't real add that much flavor.

HTH