i do not understand how 2 1/2" could be too short- or 3"??? if you cut 2 1/2" strips, attach to make long enough to go around the quilt + 10" then fold in half lengthwise- pressing as you go- stitch a 1/4" seam- raw edge of folded binding to outer edge of quilt- fold to back & hand stitch down you should have plenty to cover the seam from the front-
personally i think 2 1/2" bindings are too wide-unless on a flannel/heavier quilt- i generally cut mine 2 1/4" or even 2" i prefer thin bindings. a binding 3 1/2" wide would be like a whole additional border.