The water seal is separate. I've had mine off without sliders all winter and not a drop of water made it into the cabin. Salt did make it further into the door jam than it normally would have, but nothing terrible.
The door definitely fits flush against the running board trim, but it doesn't make an actual seal. To me, it seemed that cutting the running board from the upper trim piece and leaving that trim piece intact would make it very easy for water to work its way under/behind the trim and into the tab holes, where it wouldn't dry and cause rust.
I ended up removing the entire assembly and I covered the tab holes with heavy duty vinyl tape to prevent water from getting into the rocker. Other than having to clean the door jam more frequently, it's held up well. I might run some universal weather stripping along the bottom of the doors in an effort to keep some of the debris out, but I won't be reattaching the upper running board trim.