Wallace, when you say the Waterlox sealer is sanded down, then you say the CA is sanded down - do you mean the finish is sanded back to bare wood leaving the pores fully filled each time? If so, that's how it's normally done to fill pores completely, but no near so many coats. The CA (or other sealer) is normally wet sanded to create sanding dust that's wet with CA that fills the pores nicely.
As Edward said this isn't normally needed for stabilized wood since it's already filled. About all stabilized wood needs is sanding to a fine finish, 800 to 1500, then a nice polish on buffing wheel to look good. On some stabilized woods I have used a few layers of TruOil as finish to bring out the grain a bit better, even on stabilized wood.
Now, as to "Water Proof", that needs defining a bit. If you're talking about passing an Industrial WaterProof test, that's tough. If only used in normal use that washing in water and knife getting wet without damage?
Nothing is going to handle many times thru a dishwasher.