Tx Jim, I got a question for you concerning what Flyweight stated above. When I was going through my '66 1020 last summer I found that exact hole in the clutch housing that Flyweight pointed out. It goes through the clutch housing to where the steering column mounts. My tractor did not come with power steering from factory, (yes i know that if mine did it would use the open center setup on the timing cover). It really does appear that this hole in the clutch housing matches up to where the return would be on a later style closed center power steering column would be. It appears so close that I almost want to find me a p-steering column and associated lines to swap onto my tractor. See the pictures below.If your 1020 has power steering the hyd oil return galley in steering housing is on far left of photo(key 16). This galley allows return power steering oil a route back to oil reservoir(trans case). IIRC galley opening in top of clutch housing is closest to gear shift levers. To access this oil galley one must remove PS housing.
Blowing air into drain hole on plate on RH side of clutch housing DOES NOT connect to PS return oil galley. Another possibility for oil to leak into the area where you replaced the seal is failed shaft seal at the lower end of power steering housing
Hole in clutch housing:
View from above the clutch housing where steering column mounts. (circled in blue) The smaller hole on the left is the one that goes through housing to trans sump. The larger one in the middle matches up with the return galley that is drilled into the side of the clutch housing for return oil from an open center power steering set up.
View from side of clutch housing behind the steering gear cover. Hole circled in blue matches up with the larger hole in center of above photo. Should be the return galley for open center power steering.
I don't have me a P-steering column to match up and study, but does this not appear to be the return galley for a factory closed center p-steering column? It certainly matches up with the shape of the gasket, as well as photos i've seen of the p-steering columns.
Let me know your thoughts, thanks