Pretty uncommon among southern Chinese people and Taiwanese (many American mandarin speakers are of Taiwanese descent).
yao1 (1) and liu4 (6) should be pretty distinct. but if the way you pronounce them is similar for whatever reason, you can always use yi and chinese listeners won't flinch. in fact, taiwanese americans will be confused by yao, but zero people will be confused by yi so it's arguably better to use that if you don't know the background of your counterparty.
you use yao because it's easier to understand
qi yao yao yao ba san
than
qi yi yi yi ba san
It's mostly the qi yi yi / yi yi yi that gets hard to disambiguate.
What is likely happening is that you don't yet have the ear for the tone.
it's difficult to describe and people pronounce english words differently so this isn't definitive, but
yao1 is like "yao ming", like if you stub your toe and say "owww!" in pain, or "yowzers!" -- those vowel sounds are all the same for me, so if they are for you too, that's probably the standard sound for "yao" in chinese.
liu4 is much more closed mouth. rather than opening your mouth wide, your mouth will be closed as if you are pronouncing the english name of the letter "e". the vowel sounds are roughly like taking the words "he" and "who", stripping the "h" sounds, and ramming the vowel sounds together. this (for me) sounds similar to the sound a child makes when he/she sees something disgusting and says "Ewwww!" or the english word "few" (the opposite of many). hopefully those 3 also sound the same to you.