Original work: commonly the bore is barely smaller than the minor diameter of the thread. The tap was run in, then the plug was squinched right smartly home. There was no concern about butting the end of the plug against the bore.
This is blasphemy today.
There seems to be a modern consensus to butt the plug against the bore, and have the shoulders of the plug meet the back of the barrel nicely.
Is it necessary? Not for safety, in general, but boy, does it improve cleaning the gun after a shoot. There are no exposed threads to collect crud or rust.
Below is how I like to set up my britches. One more comment I'd like to say about this method is that when you have a really small breech, you could compromise the safety if you drill and tap a lot bigger than bore size just to get that shoulder.