The centerbard has the rope on it. The OP is asking about the other hole, with the flange.While I am not familiar with the O'Day 20, I have owned several O'Day sailboats and the photo you provide shows what appears NOT to be any type of drain, but what was the original set-up for the centerboard pendant. You will note that while the opening in question matches the color scheme of the boat, the present opening for the centerboard pendant does not. The cleat to secure the centerbord pendant is also positioned directly above the original opening for the centerboard pendant. While this opening will not serve to drain water from the boat, there should be no need to plug the opening. I do not know what may have caused a prior owner to relocate the centerboard pendant. I believe the only drain you have on the O'Day 20 is positioned in the transom well at stern of the boat.
Not sure where you get "most boats" from. A common problem is two drains both stopp up, and there is only like 4 inches between the cockpit floor and the hull. Beside, "some" boats might have the cockpit floor below the water line.I'm surprised that the cockpit drain goes directly to the bottom of the hull for discharge. I would have thought the engineer would have put it above the water line, as most boats do. If it were my boat, I would close the drain hole in the bottom of the hull and reroute the cockpit drain to a location above the water line. Since the pennant has its own tube, just leave it be.
I had a crack in hose, and I also had hard time fitting new hose, this is what I found on Amazon. Amazon.com : MonkeyJack New Boats Parts White Thru Hull Fitting for 1" Hose 90 Ddgree Boating : Sports & OutdoorsIt is a cockpit drain and does go through the hull. Make sure you inspect hose every year as mine developed cracks and it could possible sink the boat. I had a hard time installing a new hose. Used hose with wire inside otherwise every thing I tried kinked. Poor design as practically no height to make two 90 degree bends. D&R did not have a pre bent hose for it. Next time I go to replace I will take old hose to auto parts store and try to find pre bent hose with the right bends and then cut it out to fit the connections. Storing for winter I always make sure it sits with stern higher so it drains. I also put a couple boards with plastic screening on the the seats to try to keep leaves out so it doesn't clog.
A similar discussion came up on the O'Day FB group and I too was surprised that the 20 doesn't drain out the transom. But, as someone else here noted, it apparently can't drain that way because the cockpit floor is too low. It is true that many boats, including most or all larger O'Days that I know of, drain out the transom.I'm surprised that the cockpit drain goes directly to the bottom of the hull for discharge. I would have thought the engineer would have put it above the water line, as most boats do. If it were my boat, I would close the drain hole in the bottom of the hull and reroute the cockpit drain to a location above the water line. Since the pennant has its own tube, just leave it be.