What did you end up doing with that plug near the sprocket? I've got the same issue on mine. BTW we have exactly the same bike. Same color and condition. You're inspiring me to get started on mine.
Mine isn't the same color anymore...sadly. But I'm loving the new color.
I haven't done anything yet, but I am going to cut back a little bit of the rubber and JB weld the tiny slice in the metal.
And.................onto the update!
I took a couple pics of what I've in the last couple days... Nothing great. Been busy.
Got the sprocket and cover for it painted. Not you can really see what I did with the cheesy sprocket cover. A little trimming it really makes the sprocket look...better/visible/not a sprocket cover. lol
And with the jugs and head off, I've been doing a ton of paint stripping and cleaning. Bam, it dawned on me that I need to replace the valve seals. Got 'em. Might as well do 'em. So, here she is stripped down.
I should also mention that it took 3 hours to remove the head gasket crap left on the bottom of the head. Thought I'd done it already, but...yeah...3 hours.
I got the nuts for the head studs today, so I can finally put it all back together, strip the block, and paint the whole thing. That's about all I've got for now.