Most of the putty is supposed to ooze out, with just a little remaining taking up the space between the drain pipe and the sink. If no water is dripping under the sink, then the water is draining into the pipe. The mechanical stoppers are notorious for going bad after a while. Their seals dry out and crack, or their mechanism does not apply enough pressure to prevent drainage. They are also difficult to replace. They can be replaced with manual stoppers of different styles that do not activate from using the push/pull behind the knobs. It is not the drain seal between the drain pipe and the sink. It is the stopper that is failing you.