Drill into steel frame for cargo rack
It mostly depends on the thickness of the tube.

Chainstays and seat stays tend to be quite small tube, so drilling them takes a larger percentage of metal away.  I would not drill a stay unless I had a welder to add metal- instead I'd use a clamp-on fitting.

For downtubes and seat tubes, the tube itself tends to be wider.  I've successfully used a nutsert or rivnut to add bidon mounts to a steel road bike.  This involved careful drilling, then using a special tool to mount and crimp a special insert into the frame.