R122;
A simple plug in the back of Cyl Head is not common, and it is something I've ever seen before (on cars...don't know so much about marine B18s!)...it eliminates the Heater Core Loop entirely (so this suggests a brute-force solution to a leak in this loop in the donor vehicle, or origin from a boat maybe...if your Heater Loop is not known to leak, I'd go ahead and remove this plug, and reconnect normally).
...just wondering...what does the return from that loop at (8) into Water Pump look like?...that's a smooth tube fitting...one can't just wang a plug into that, and it would need to be closed off if Heater Core Loop was abandoned or be a leak in the Cooling Sys...
Source:
https://www.sw-em.com/Cooling_System...cooling_system
Cheers