I think you've made an excellent decision for your Day 3. We like to get up and hit the water parks as soon as they open. This way, we have everything done (most multiple times) by early afternoon.
You guys really need to do Crush n Gusher. It was so much fun. I don't know if you remember or not from my trip report, but your booty bone will get beat around pretty good if you don't raise up a little as you go down the slide. Yeah, learned that the hard way!

Is it as scary as the Disney coasters? I personally didn't think so and that comes from somebody who is scared to death of heights.
Don't forget that they have the shark reef at Typhoon Lagoon too. We've done that a couple of times but actually forgot to do it this past trip. You don't have to be an experienced snorkeler to do it. They'll give you a short lesson on how to use the snorkel and you'll soon be floating across the reef and looking at all sorts of fish and sharks. Hunter can float but he felt more comfortable using one of the life vests that they provide free of charge.
We usually hit the slides first thing in the morning before they get really busy. I think we did the storm slides and the other tall one (can't remember the name right now) five or six times each before the lines got long.
As far as Downtown Disney goes, you can't go wrong with anything there in my opinion. Disney Quest was a blast and that comes from a lady who doesn't like video games at all. Make sure you do Pirates of the Caribbean 3D, Jungle Cruise and Mighty Ducks. I never could get the hang of the Aladdin Magic Carpets but that could be because my helmet thing kept sliding back and forth.

John and Hunter built their own virtual reality roller coaster and were spinning all over the place. We bought the video once they were off. It was soooo funny!
Don't forget to pop into Ghiradelli's and get your free sample of chocolate. They give out the little miniature bars to everybody who comes in so make sure each of you go in.