John in this passage must not be thinking of Jesus as incarnate Word, he must be thinking of the eternal, bodiless Father who according to his christology has only been “seen” by Jesus. His meaning seems to be that though God cannot be seen by mortals, God can nonetheless be experienced within the hearts of believers who “love each other”.
The real problem is that John is mistaken. The Torah is replete with references to Jews who saw God. In one place, God is plainly seen by many elders during a picnic on Sinai’s slopes - Exodus 24: 9-11.
It would seem, therefore, that John is operating from a theology or a tradition in which it was thought that no one has seen God. Where he got this unbiblical notion is the rather puzzling question.