Yes, the flat tip (or cutoff tip) has less induced drag because it is more difficult for air to swirl around the cutoff tip.

A better solution than the cutoff tip is actually a sharp tip, but it is more difficult to build... or you could use a simple Hoerner tip (used on a lot of model aircraft out there). Again, the Hoerner tip is more difficult to build than a cutoff, but it is a better solution.