Just wondering, when you did your horizontal stitching did you begin at the center and then progress to the edges? Three inches lines would give some play between the layers... does it depend when the walking foot reaches the sewn line as to the stretching on the open area? Also wondering if you would stitch an additional line of stitches at the 1-1/2" mark would solve your issues? I am positive someone with more experience than I will have an answer for you.
I am sorry about your problems.
Judy in Phx, AZ