727 Leak Inside Bellhousing

So, looking at the trans, the input seal looks perfect and still has some greese present. I did see this pipe plug looking like it was loose. I checked a spare trans and this plug is flush. I took it out, cleaned off the Teflon tape, used pipe paste and reinstalled. Now it went flush. Could it be the source of the leak?

I had a very small leak at that plug. I’m not sure what it’s purpose is but after doing what you mentioned it never leaked again and has been working fine for two years.