Yeah, that could be the seal that goes around the clutchcable where it goes into the engine, right behind where you're looking. If so I don't know how it'd pop out though unless theres a cut along it to slide on around a cable.
But I agree it looks more likely someone put it into that hole where it doesn't actually belong. That hole is an outlet for the decomp. The decompression valve on top of the jug is routed inline with the clutch starter cable so that when you pull the cable to start the bike it opens a valve to a little hole at the top inside the cylinder, making it easier to turn the engine over for starting. when open, the valve just exhausts out that hole, so it shouldn't ever be plugged.
The decomps are notoriously problematic on sachs, the cables over time can wind up a little tight holding it slightly open or just with use the old oil from the premix blows out the decomp while starting and eventually it can get gunked up to where it doesn't seat well anymore. most people remove the valve and thread in a bolt to block off the decomp hole. it makes it slightly harder to start, but not really, it's a pretty useless valve. But plugging it closes off the possibility of the decomp leaking which robs you of power and creates an airleak.
If the decomp leaks though it's accompanied by oily buildup coming out of that hole. you don't seem to have that problem. Either way plugging the hole on the bottom of the cylinder does nothing. either leave the decomp or replace the valve with a bolt that blocks it off.