Doesn't matter. There are some who feel that the plug must be within the stem, but I don't thing it makes a difference at all unless you over-tighten the plug like crazy. If you decide you want to push the plug deeper and have it within the stem, all you need is a screw long enough to reach it. Save the old screw for when you cut the stem.

BTW- nobody does it this way (probably because it isn't needed) but the only place the plug would make a structural difference is halfway down into the headset. This would buttress the steerer at the fulcrum of the bending moments, where failure is most likely.