The seed is mixed in with the sand, but seed will germinate also when laying in contact on top of soil. Seed needs to be kept moist in order to germinate and survive. Certain additional actions can (and should) be taken to help in maintaining needed moisture levels to improve the germination/establishment success rate. Among those options are topdressing, covering with turf blankets, using moisture agents, slit seeding etc. A thin layer of sand over seed would be classified as topdressing. IMO, not the best of options, but as I mentioned, golf coursed employ it as a repair technique. Are you considering this for repairing smaller areas in your lawn (e.g. spots that died due to dog urine) or something else (e.g. leveling and overseeding the entire lawn as a combined process)? If the later, I would advise against it.