Have a close look at the head for any damage where the #3 plug screws in, especially around the threads and the seating area. It almost looks like pre-combustion gasses may be escaping and are being igniting or burning outside the cylinder... The damage may have been caused by prolonged detonation, by some casting fault that let go when you removed they old plug or by a cross threaded plug. Hopefully it’s not a big issue, just some crud that stops the plug screwing all the way to the plug seat.
Also have a look inside the plug lead and check nothing is bent or damaged otherwise the clip won’t grab the end of the spark plug and the spark energy wont go down the plug as it should which may result in seeing sparks towards the block,... outside the engine.