YHWH is a merciful and gracious God, slow to anger,
abounding in ḥesed we-‘ĕmet (= John's "grace and truth),
keeping ḥesed (= John's "grace") for the thousandth generation,
forgiving iniquity and transgression and sin (Ex. 34:6b-7a).
So, what John is saying is that Moses did indeed received the Torah, but that Jesus brings the ḥesed we-‘ĕmet, the "grace and truth" mentioned in Exodus 34:6. John is thus saying that Jesus is greater than Moses because, as the divine Word, he gave the Torah to Moses, and brings the "grace and truth" which allows atonement and forgiveness of sins, the key component of the Mosaic Torah.
1:18, No one has seen God
The Prologue of John ends with a rather puzzling statement: "No one has ever seen God. The only Son/God, who is at the Father's side, he has made him known" (Jn. 1:18; cf. Jn. 6:46; cf. 1 Jn. 4:12, 20; Lk. 10:22). The idea that "no one has ever seen God" seems to be based in part on the Hebrew Bible (Dt. 4:12). When Moses asks to see God, he is told "you cannot see my face, for man shall not see me and live" (Ex. 33:20; cf. 3:6). Many other Hebrew Bible passages likewise reflect fear of destruction if someone sees God (Gen. 32:30, Ex. 19:21, 33:18-23, Jdg. 13:22, Is. 6:5). Yet even these passages imply that God is at least theoretically seeable, since if he were completely unseeable, there would be no need to fear the consequences of seeing him.
On the other hand, there are a number of passages in the Hebrew Bible which describe men seeing God, sometimes explicitly "face to face." Examples include: Abraham (Gen. 16:13, Gen. 18), Jacob (Gen. 32:30), Moses at Sinai (Ex. 33:11; Num. 12:7-8, 14:14; Dt. 5:4, 18:15, 34:10; Sir. 45:5), the elders of Israel at Sinai (Ex. 24:9-11), Micaiah (1 Kgs. 22:19), Isaiah (Isa. 6), and Ezekiel (Ezek. 1). Some scholars believe that these apparently contradictory concepts about the visibility of God represent two different ancient Israelite traditions, which were merged together, though not always seamlessly, sometime in antiquity. However that may be, this was not an understanding of the Hebrew Bible at the time of John. There is an equally strong early Christian tradition that God can be seen, especially in an eschatological sense (Mt. 5:8; 1 Cor. 13:12; 1 Jn. 3:2; Rev. 1:7, 22:4). Paul likewise claims the aoratos/unseen attributes of God can be "clearly seen" (Rom. 1:20). 3 John 1:11 says that "whoever does evil has not seen God," implying that the righteous are able to see God.
So what does John mean here? The idea of an "invisible God" may also be reflected in New Testament passages that describe Jesus as being the eikon/image of the aoratos/unseen God (Col. 1:15; 1 Tim. 1:17). The Greek term aoratos, however, is somewhat ambiguous. It can mean either "unseen," or "unseeable." Of course there is a fundamental difference between something that is "unseen" (we don't see it right now, but in theory could see it), verses "unseeable" (inherently can never be seen). Aoratos is often translated in modern translations as "invisible," which makes sense in some ways. However, in the Septuagint and New Testament the term is used in ways that make "invisible" inadequate.
For example, in the creation narrative, when the earth is "void" (tōhû), it is described in Greek as aoratos (Gen. 1:2). However the created earth was not invisible, but is unseen because it is shrouded in darkness. Likewise, in Isaiah 45:3, in the phrase "treasures of darkness, the hoard in secret places," "secret place" is translated as aoratos in Greek. Here the treasure is not invisible, but is hidden in darkness, and therefore unseen. Likewise, in Hebrews 11:27, Abraham is said to see the aoratos God, probably an allusion to the theophany in Genesis 15:7-21 (cf. Gen. 16:13, Gen. 18), where Abraham "sees" God carrying a lamp, but shrouded in darkness, rendering him "unseen."
Why does it matter if God is unseen or unseeable? In some ways, it doesn't. The Greek word aoratos is ambiguous, and should probably be translated into English with the same ambiguity: "unseen," rather than "invisible." So we are left with a bit of a paradox. On the one hand, there is a biblical tradition that God is unseeable, and on the other, there are passages that strongly suggest that God has been seen and will be seen. One solution is simply that there may have been different traditions and beliefs among biblical writers about the visibility of God; some believed God cannot be seen, others that he can. Some early post-New Testament Christians, on the other hand, tended to interpret theophanies in the Old Testament as manifestations not of the Father, but of the preexistent Word—that is Jesus as the second member of the Trinity. Thus God the Father was never seen in the Hebrew Bible because all biblical theophanies in which God was seen were manifestations of the preexistent Word, God the Son.