Take it to a pro shop operator who knows how to drill a ball. Here's what happens. The slug is a solid insert around 3-3 1/2 inches long. A 1 1/4 inch or 1 3/8 diameter hole is drilled, and the slug is pushed/pounded into the hole. The problem arises when the slug is not seated at the bottom of the hole, whether by the hole being drilled too deep, or the slug not being pushed in far enough. Over time, especially if too much glue has been used, the slug slightly compresses enough (especially with larger thumbholes) that direct force will result in the problem you are having. Bottom line, if you have a 3 inch slug, drill the hole 2 7/8 inches deep, and make sure the bottom of that slug hits the bottom of the hole.
As far as your other question, I really like the IT system. I don't drill a lot of balls, but when I do, it's so nice to be able to just screw in a thumb that I've already worked out and gotten just the way I like it. But to directly answer it, if you like a slug, it may be as simple as drilling that one out and putting in a new slug, but if the hole is too deep, the bottom inch or so may have to be plugged and slightly drilled back out.
