I think it's true that he never saw it. I read once in some such place as Ripley's Believe It Or Not that he just looked on the map for a river around the right location with the right # of syllables and the right sort of sound for his lyric, & pitched on the Sewanee [Suwanee?] becoz he liked th4e sibilant at the beginning. & then he didn't pronounce it quite right to make it fit the rhythm SFAICS; and then Gershwin & Jolson...!

Wikipedia, which spells it Suwannee, sez

"This river is the subject of the Stephen Foster song "Old Folks at Home," in which he calls it the Swanee Ribber. Foster had named the Pedee River of South Carolina in his first lyrics. It has been called Swanee River because Foster had misspelled the name. Foster never saw the river he made world famous. George Gershwin's song, with lyrics by Irving Caesar, and made popular by Al Jolson, is also spelled "Swanee," and boasts that "the folks up North will see me no more when I get to that Swanee shore."

Both these songs feature strumming banjos and reminiscences of a plantation life more typical of 19th century South Carolina along the Peedee than among the swamps and small farms of the coastal plain of Georgia and Florida."

~M~