I don't think the seahorse does anything worthwhile.
Got so fed up with it using up one of my fish places for no apparent advantage that I got rid of it!
Haven't noticed anything different about the game:
Fish breed, age, sell, get sick, get cured, are just as hungry as they were before. I have found all of the fish without ever purchasing the seahorse too.
Perhaps it's more of an advantage at the beginning of the game (someone suggested L3 fish surviving in a L2 environment) and perhaps the reason that you are able to bin it is because when you have researched the top levels you no longer need it?
I have a couple of spare user slots so will play identical games, one with and one without a seahorse. Watch this space...