I have set up rules and created a template, however I cannot get the post offset rule to skip the latest 3 posts. Please advise

I think you have not inserted values in this field "# of Posts" and only put values on "Posts Offset" that's why it is not working.
Posts Offset is ignored if you show all posts. You can read here - https://codex.wordpress.org/Class_Reference/WP_Query#Pagination_Parameters so to achieve same results,
I hope it helps you.

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