Mark,
Great to hear from you. The documentation that Saretta was Thomas's daughter comes from a March 3, 1863 deed in Greenup Co., Ky. Deed Book N, p. 633, in which James A. Dillon, Phineas Arnold and wife Saretta Arnold of Greenup Co. sell their interest in an estimated 100 acres owned by Thomas Dillon at the time of his death to Fielding H. Dillon. Fielding paid $75 to James and $75 to Phineas and wife Saretta, "daughter of the late Thomas Dillon" of Greenup County. I'll send a more detailed response to your personal e-mail.
Regards,
Rodney Dillon