Does janusSEAL for OWA work on Exchange Server 2003 SP2 with security update KB959897?

Yes.

Security update KB959897 for Exchange Server 2003 SP2 does not change the Outlook Web Access files that janusSEAL for OWA hooks into, so if you have an Exchange 2003 SP2 server upon which janusSEAL for OWA 2.1 is working there should be no issue with installing this security update on the server.

The Microsoft Knowledge Base article page has a listing of all the files which are modified by the security update and none of those files are used when integrating janusSEAL for OWA with the Exchange system.