I was thinking the exact same thing. I have never seen a crack carry over from cast iron into a steel plug, doesn't seem plausible.
If my hunch is wrong, and it is truly a freak crack that did affect the freeze plug, use Lock-N-Stitch. Welding repairs can fail, then you have a even bigger problem to fix. I had a "welded repair" fail on a 1938 Cadillac 60 Special that I restored. I did have some luck in saving the block with some serious toxic epoxy from 3M, but I don't want to do that again. I got turned onto Lock-N-Stitch from Turlock, CA about a decade ago. I have repaired several blocks with it. The worst was a 440 with a 7 inch crack that went into the freeze plug hole. After each repair, I carefully ground down the stitches and ran a Air Needler acrost it. After a repaint, every repaired block that I have done is 95% unnoticeable. I have had no failures and highly recommend the product. Not only are welds not as successful, they look really ugly and you can't hide them.....
Has anyone else tried this amazing product?