You should be fine. Any light oil that doesn't gum up or turn to asphalt during the winter. I've read folklore that 3-in-1 contains vegetable oil that polymerizes over time, and chainsaw oil is too sticky. A friend of mine used 2-stroke oil because it's what he had.
The ratios are 4:3, 1:1, and 3:4, and they all freewheel (there is one non-freewheel 3 speed hub, but it's a rarity). at the present time, 3 bikes in the family fleet have old Sturmey Archer 3-speed hubs. I like the simplicity and lack of exposed parts. I think there are several reasons why they're not more popular, even beyond the added cost. Folks look at the number of gears as a figure of merit for the bike. Also, gearing choice depends on a lot of things, such as your local terrain, physical condition, and even just personal preference. Nobody knows what gears they will "need" until they get the bike and experience it under real use for a while. So, having more gears is an assurance that the bike will serve their needs.
For my riding, the main downside is actually that the gears are spaced too far apart. This leaves me in the situation of being "always in the wrong gear." Unless you gear the whole bike down, or are more athletic than I am, the 3rd speed is practically useless and it's effectively a 2 speed bike. Sheldon Brown recommended choosing a cog that lets you use 3rd gear as your normal cruising gear, with a low and extra-low gear.
And now here's where personal preference comes in. I put up with those limitations because I usually ride by myself, can just ride at whatever speed is appropriate for the available gears, and not worry about it. But if you're keen on riding at the absolutely optimum cadence and speed at all times, or are trying to keep up with a group, having narrower gear steps is beneficial.
We're all agreed that 3 is the wrong number of speeds, what divides us is whether 3 is too few, or too many.
