They aren't cork or wood: Everything You ever Wanted To Know About Cooling System Sealant Tabs
Engine rebuilders put them in to reduce the number of complaints from customers who don't seal bolt holes or have issues with gaskets. The rebuilder did his work right, but they have no control over assembly by the end user, and it gets old really quick explaining for the millionth time that a weep or leak isn't their fault. They aren't the ones screwing on the manifold, etc.
If you do have a coolant system leak, try them yourself - about $3 at the auto parts store, vs $10 for the liquid junk that gets foisted on the public. That is just the same thing dissolved into a solution along with copper or aluminum filings (like you need that junk floating around in there, too.) If 5 or 6 tablets in a V8 won't stop whatever leak you have, nothing will. Fix the problem correctly next time.
They are a simple preventative for the normal weeps and mismatches in assembly that will happen when millions of engines are bolted together over the course of a year. Take a good look at a new car lot - none of the cars out there are leaking antifreeze, ever. There's a reason for that, consider the thousands of new parts attached to each other and barely run in for less than ten miles in many cases.
I might suggest that auto pros are well aware of this and have been for decades, but it does come up in the hobby builder radar every now and then. Rebuilders and new crate motor assemblers use them for a reason, and it's directly related to who they sell to. That supposedly blind hole that can't possibly be connected to a water passage, is, whether someone thinks it should be or not. Manufacturers aren't going to scrap an otherwise healthy block for one simple leak, especially when some RTV and experience could solve the issue. Thousands of blocks are on the road their entire life with bolt holes that DO connect to a water jacket. It's a matter of good assembly practice to prevent rework.
If a gasket would seal 100% the first time, we wouldn't be smearing shellac or silicone on them anyway. Try putting a thermostat gasket on dry next time. It will likely seep for days before finally sealing up. No new car maker will suffer letting their buying public see that on the new car lot, regardless of how inconsequential it may really be.