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Uddesavārakathāvaṇṇanā

What he sees = What man or woman he sees.
Why, is there no seeing of man or a woman with the eye?
There is. "I see a woman," "I see a man." — these statements refer to what he sees by way of ordinary perception.
That perception, owing to wrong comprehension, does not get at the sense-basis [rupayatana] in the highest sense, philosophically, through the falsely determined condition of material form [viparita gahavasena miccha parikappita rupatta].
Or the meaning is: the absence of perception which is called the seeing of primary and derived materiality, beginning with things such as the hair of the head, owing to non-cognizability of the collective nature of an object like a man or woman by eye-consciousness [kesadibhutupadaya samuhasankhatam ditthi na hoti acakkhuviññana viññeyyatta].
What is seen that he does not properly see = He does not see, according to reality by the eye of wisdom, the sense-basis which exists, the collection of primary and derived materiality beginning with hair of the head and the like [yam rupayatanam kesadibhutupadaya samuhasankhatam dittham tam pañña-cakkhuna bhutato na passati].
Not seeing properly he is shackled = Not seeing this body as it actually is, with the eye of wisdom, he thinks: "This is mine, this am I, this is my self," and is bound with the fetter of defilement [imam attabhavam yathabhutam paññacakkhuna apassanto etam mama esohamasmi eso me attati kilesa bandhanena bajjhati]

пали	Apassaṃ bajjhate mūḷho, bajjhamāno na muccatī"ti. –
Soma thera	Not seeing (properly) he is shackled clean; And he, the shackled fool, cannot get free.{16}