Left side of engine, in cylinder head. There is an identical hole in right side, but there is no oil coming out of it and no smoke when I fire up the bike. I can' find any mention of this hole in the manual. PS This is the 1988 that I am trying to fix up.

 

That's a hole that would let ant water run out from the plug area.
ie; While riding in a rain storm and water gets down the spark plug area the water has a place to escape.