Just replaced the entire radiator on the 97 last month, so I had a chance to inspect it closely. It turned out to have a leaking seam.
You thread the drain plug into the radiator till it bottoms out on the shoulder next to the hex wrench fitting. The sealing is done by the little o-ring on the internal end of the drain valve not the shoulder part. When the valve is tightened it slides the o-ring into a sleeve inside the radiator tank which prevents flow from the tank into the valve drain hole between the o-ring and threads. When you loosen the valve, the o-ring is moved out past the sleeve and it allows coolant to flow from the tank past the o-ring to the valve drain hole.
I expect these common drain valve drip problems could be solved by replacing just the o-ring, but its easier to get a complete valve assembly.
06 Laredo - 4x4 - V6 - Stone White - Custon LED Cargo Area & Under Hood Lights, Lighted Visors Added - now at 45k miles
97 Laredo - 4.0 4x4 Relocated to Arizona after 8 great years of service - still a DD with the relatives