It's from the Gaelic word "plaide" which rhymes approximately with "badger" in most English accents, and means blanket. "plad" is the preferred pronunciation

It's from the Gaelic word "plaide" which rhymes approximately with "badger" in most English accents, and means blanket. "plad" is the preferred pronunciation of the English loan word. English spelling is a mess, so mistakes are understandable. "Plaid" in "Plaid Cymru" is pronounced like "plied" in English.