I see both "Related Work" instead of "Related Works" phrases in papers. Assuming either one of these could be used, can someone explain why that is so? If more than one reference is listed, it seems the heading should be "related works" (plural) or maybe the those that say "Related Work" are in error?
You are right that both related works and related work are used in papers, and both are correct. Furthermore, according to Google n-grams, related work is roughly 4 times more common than related works, though it is difficult to know if these occurrences are within the context of papers such as you are interested in.
An explanation for why both are correct comes from the different meanings of work and works. Related works refers to publications themselves, while related work refers to the actual work behind the publications.