Why would the overflow drain on a bathroom sink have to blocked if using a plunger to unclog it?

the reason you want to exclude as much air as possible is the fact that air is compressible and water is not. when you plunge it's more effective when the plunger bell is full of water not air. the water column then transfers your plunging action directly to the debris plug. the reason you close off the overflow is that you don't want water to escape resulting in a diminished column to the debris plug.