I fought this flooding also. I had a rebuilt carb. Flooded! Put a new needle and seat in from Wayne. Still flooded! I then ordered a carb kit from Carpenter cushman, as I figured I had nothing to lose. While waiting on this kit, I read somewhere that to seat the needle on the Tillotson MT, push the needle into the seat firmly with a pencil eraser. I did this with the new one, and Viola, it doesn't leak a drop now. I left the compression plate off for 3 days, left the fuel strainer turned on and it was dry as a bone in the motor. If I did this before, gas would continually pool in the case.
Now, for the drain hole. Wayne claims not necessary. He said to just put a little JB weld in the hole and be done with it. The screw on the bottom of mine was stripped, so I did as he said and haven't seen a problem.
Rick