Does water heater pilot setting still heat water?

The pilot setting will heat the water a few degrees. A gas water heater will have a thermal rating in BTU of 30,000 to 80,000. The pilot light by itself will have about 1,000 BTU. Operating overnight with no water movement and a well-insulated tank, you will observe a temperature rise but certainly not enough for clothes washing, dishwashers, or showers.