I think that 3.5u is probably too much insulin, since 3u was too much insulin. The problem with raising the dose based off only his preshot numbers is that you don't know how low he is going during his cycle, which is why getting a test in the middle is important. If he's going too low then it's going to make his blood sugar go high in order to combat the hypoglycemic numbers. A too high dose looks exactly the same as a too low dose unless you get some tests in the middle of the cycle.
I know you have your hands full, but one more test only takes a few minutes do and it could really, really help Fluffy. I don't think his condition is going to improve if you keep raising the dose...in fact, it will likely worsen. You can try feliway, but it's not going to help anything if the urination is being caused by his uncontrolled diabetes, which is likely is.
You've been taking your vets recommendations and Fluffy has not improved. Why not try this out for a couple weeks with our help? If you don't see an improvement you can go back to the way you're doing it now.