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When saving a DGN file with a Sheet Model to DWG, the DWG file does not convert to an equivalent sheet/layout configuration, instead the data from Sheet Model appears in the DWG model space and the Layout is blank.
In the Save as DWG Options dialog: Save as DWG options, General tab> Advanced, make sure there is no check mark in the option:
Create Separate Files for Sheets.
Should the issue persist:
Note: In V8i SELECTSeries 4 a change was implemented to save single sheet model as a layout model (paperspace in DWG) by default. The following variable MS_DWG_SINGLESHEET_AS_MODELSPACE=1 can be set to bring back the old behavior, i.e. to save your sheet model as the modelspace model.