Yes, dipstick plug should be resting on the shoulder of the hole (unscrewed) to measure the oil level - make sure that your bike is on the centerstand on level ground, wipe off the oil from the stick scale and put it back so that the plug/cap is resting on the top of the hole threads for a little bit and re-check. You will probably find that the oil level is between the minimum and halfway to full. For some reason, all airheads I've owned seem to like being in the middle of the range. If I fill them towards the top mark, they tended to blow more oil out the crankcase breather hose into the airbox until they were a bit lower, and then all was fine, with no further oil blowing.