It helps in two ways. First, the hole should always be in the 12 o'clock position. This helps when bleeding the system. If the hole was not there it could possibly trap air.

Second, it helps circulate a little bit of water while the thermostat is closed which in my opinion helps to stabilize the temps a little. Without the hole I have seen temperatures go up and down 10 degrees, with the hole it drops the movement a few degrees.

If you got in a bind you don't have to have the hole in there, it will get you home just fine. The hole is to further improve the mod as the thermostat is laying on its side instead of pointing up like in small block applications.