OOB, the presence of that link is determined by glide.authenticate.multisso.enabled property so when multi-sso is on that link will be present on the login form taking away the ability to hide the link but have multi sso active.
If you really wanted to override the login page, you can create a ui page with the same name (i.e. 'login'), but you'll need to contact support to see if they will provide the Jelly as a baseline as it is not exposed like some OOB UI Pages are.
If you were using Service Portal or CMS you may some more flexibility as they can specify their own login pages.
Alternately, if you direct only the local users to /login.do (to see the OOB form) you can just instruct them not to use the 'Use External Login' link as it is not part of their process. Then direct SSO users to /navpage.do (or pretty much anything else) and if the redirect property is set they will get redirected. So no one actually has to follow the link even though it is present to make the secondary form submission.
