No, not with a 3 inch tear. I know overstreet allows 2 inch tear at the 2.0 level so even if this is a bit more than that, I would still go with 2.0.
And yeah, it's that tear that's the biggest detriment. I learnt that dust shadows, while ugly, are not that big a deal breaker for CGC. We can't get super high grades with them, of course, but I've seen some real bad dust shadow get 8.0s. I guess they see it like oxidation and yellowing. Not wear from the user but more like wear from age and the elements.