From what I understand, the hulk remained until after the end of WW2, where she sank in 1941.
In 1959 there was a salvage effort done which (to all appearances) raised her off the muddy bottom. Photos taken following the refloating seem to confirm that the submarine was moved from one location to another, in the same general vicinity of Sangley Point.
After that, there is some debate as to what happened to the sub. Was it towed out and sunk in deeper water "someplace off Corregidor"* or did it sink following the refloating effort, or was she eventually scrapped by the Philippine government? Unknown.
One curious note: following the devastating passing of Typhoon Yoling in the 1970's, a hulk of some sort was washed ashore along Roxas Blvd near the area where the land was "reclaimed" (and where the Sofitel Hotel now sits, not too far north from SM-MOA) that resembled the cylindrical tube of unknown dimensions that tapered to a point on one end, that looked like the cut-off after part of a submarine hull. Dad snapped 2 black and white photos of this from the Boulevard. The prevailing belief at the time was that it was part of a Japanese submarine being scrapped. It may have been a submarine hull, or it may have been something else. If a submarine hull, it may have been a Japanese sub, or it may have been the USS Sealion.
Read the story of the refloating operation here:
www.usssealion.com/sealion/Saga_of_the_Sealion.htm* - from the above website.
Of curious note: I found some color photos taken by a tourist once, who took a banca boat out to the washed-aground hulk near Roxas Blvd, and it almost seems that there is a some sort of structure on the tapered end that almost looks to me (not being an expert on such matters) like it was a platform of sorts, right where one would expect the propellers of the sub. It kinda tends (to me, at least) to not look like a submarine hull, unless that platform was added later. Bear in mind this thing was huge, and could not have been mistaken for an oil tank or any of the prewar submarines sunk as targets around the entrance of Manila Bay.
What really happened to the USS Sealion? I do not know.
Was the hulk washed ashore in Manila the Sealion? I do not know. I can post the B&W pics Dad took (there are two, one shows details of what would be internal bulkheads if it indeed was a submarine....if I can figure out how to post pics here without publishing them to the internet first.
Was the hulk a Japanese submarine? I do not know.
Was the hulk a submarine to begin with? I do not know. But I am starting to be skeptical. Nobody seems to know for sure, and not may photos of it can be located.
There are three images of it here:
www.flickr.com/photos/kuyadusty/7059529745/in/photostream/Note the line of barnacles (whitish things) on the "hull", showing that at one time the thing sat submerged at a far different angle that where it rests in the photos.
Sadly, the only photos I could find that show any kind of interior detail are Dad's old photos.
So, to answer one question: the sub was definitely refloated in 1959 and was not scrapped by the Japanese.
And pose another question: what happened after it was refloated?
And a final question: was the washed-ashore hulk a submarine at all?
Cheerio!