As documented in the release notes, Update 3 supercedes Update 2, and Update
2 appears uninstalled after Update 3 is installed. The errors you saw were the
result of your server successfully preventing you from installing Update 2
over Update 3, and indicate that nothing was changed on your system when
you attempted to install Update 2 after Update 3.
If Update 3 is marked as "Installed" in the blades panel, your system is fully
up-to-date.
Hope this helps,
--Rich