I definitely say this to members of my congregation in Sweden. It might be because 1. I am a female (quite maternal too) and 2. because I come from Scotland originally. We use the "love" word a lot more in the UK than in Sweden. I remember a colleague in the church telling me that he only ever said "I love you" to his wife and "tycker om" to his children.
I guess it's the actual phrase "jag älskar dig" that is the problem in the church context. Churches talk a lot about kärlek (thank goodness). My congregations seem not to mind. Mind you, they had to put up with a whole sermon from me about "den fattiga ankan". I still get ankan and änkan mixed up hence my delight that this Duolingo Swedish course is here so I can keep revising.
I fondly remember a frail old woman patiently listening to a sermon delivered by a man with a very distinctly American accent, only to walk up to him afterwards and ask him suspiciously whether he came from Norrland eller utsocknes. This was twenty-odd years ago, mind.
In isolation, "dey" is not a bad approximation in English. (Loads of examples here: https://forvo.com/search/dig/sv/)
But in practice, the initial d often tends to merge with an ending consonant of the previous word - especially verbs ending in r. So älskar dig has a tendency to become something like älskarig, especially in some regions.