No, säen and sehen are distinct in many dialects. The vowel in both verbs is long. Long e is rendered as [e:] while long ä is rendered as [ɛ:] in many dialects thus providing a clear distinction. You would have been correct if the verbs had short vowels. Short, stressed e is pronunced [ɛ], exactly like short, stressed ä.
Furthermore, sehen is an irregular verb whose vowel stem vowel changes in parts of the present tense (du siehst) and the past tense (ich sah). But even in forms with the unmodified vowel (ich sehe) is the vowel quality distinct from that of säen. Säen in the present tense always retains the same (long) vowel quantity as expected from the lack of a double consonant. And the participles (sehend/sähend; gesehen/gesät) retain the long vowels and thus the differentiation, too.
However, not everywhere are the distinctions between long ä and e kept. Especially in the North, the pronunciation of Käse as ['ke:zə] is prevalent (compare standard ['kɛ:zə]). These dialects would have difficulties distinguishing between the two.
Note on pronunciation: The [ɛ] sound is more open than the [e] sound. They can be compared to French è and é, respectively. Unfortunately, English pronunciation is too unregular for me to come up with examples right now.