preflop i prefer either a shove or fold depending on how often he's 3betting. i would also minraise pre instead of 2,5x.
i don't hate your play on the flop, because you may fold out some flushdraws which we would prefer to fold out rather than have them stick the rest of their stack in. however, this is a $3.50 and i'd imagine most people at this level would snapcall with any decentish
, so i think c/r AI on the flop is better, at least that gives him a chance to bluff/stack off with worse (i.e. he might fold a 5 or 9 to your jam, but may b/c them himself).