hi busybee, two boys with problems understanding language here. one has grown out of it, the other is getting there fast. I think you have to hit the problem hard, but all the work will be worth it as it will benefit him for the rest of his life.
I strongly agree with the idea of buying "More than Words". Don't worry that it talks a bit about spectrums/conditions - it will help any child whose vocabulary is ahead of their comprehension. "It Takes Two to Talk" by the same publisher is even better at showing you, the parent, how to simplify your language down to his level (it emphasises the child's ability to talk rather than understand but it helped me enormously to develop good techniques with my kids). If you don't like the idea of books that talk about conditions/spectrums a bit, choose the "It Takes Two" but also go for the visual learning ideas I describe below. Both books are very positive and make you feel good about yourself/ your child.
I'd get that referral to the paediatrician. Repeat to your GP the phrase "his vocabulary is ok but I don't think he understands all I'm saying to him" until you are blue in the face. That's the critical issue. Speech therapists should be delighted to have a parent who knows their child's problem lies with understanding - usually they have an uphill battle persuading the parent that this is the case.
He may well be a better visual learner - when children struggle to understand rapid speech, they tend to look around them for clues and act according to what they see plus the limited amount they've understood. If you go through a diagnostic process, the end result will probably be that his nursery/school will be told to use "visual learner" strategies like visual timetables. he may be happier if you produce photographs and quick drawings of things you're talking about. Visual learning stuff is great for talking about planning the future and time. When describing what's going to happen today/this afternoon, write it on a bit of paper with a "1" against the first item plus a picture and a "2" against the second item plus a picture. Then give him the paper. The aim is to give him things that are permanent and that he can refer back to for as long as he needs to. You know how even though you konw you are doing something on the 16th of the month, you still look at your calendar anyway? That's probably what life is like for him - visual things are more "solid" than words. He may benefit from having a calendar on his bedroom wall and being able to tick off each day at nighttime - there are many threads about this on the special needs board and I can point them out to you if you want. Calendars really help children with language problems get an understanding of time. Things like board games where you can keep getting visual cues from the board's layout are good too.
You need to simplify your language down to his level then bring it back up only at the speed his understanding increases. "It Takes Two" will show you how to do this.
A very good website is www.teachmetotalk.com. Look for the sections on "receptive language" - this means problems understanding language. Consider buying her excellent DVDs "teach me to listen and obey" (don't be put off by the title). He's ready for volume 2 if he has a normal vocabulary.
If he does have problems understanding language (and let's face it, repeating back is a classic sign of this, plus this is something that you are in good position to judge, as you are the world's expert on him) then it's almost inevitable he'll cling to routine and be a bit inflexible. After all, wouldn't you? If you focus on increasing his language comprehension, he should get more confidence to increase his flexibility.
Children with problems processing language often also have other "sensory" problems. He might have stronger reactions then his peers to things like rainfall on his head/wrong clothes; bathtime, loud noises like hair dryers - this can come and go over the next couple of years. You need to know about this if it applies because sensations that might seem trivial to you might be uncomfortable or even painful to him - and that's going to block his opportunities to learn and interact. "Sensory Integration" is the buzzword if you want to google.
good luck. You're lucky he's just turned 3 as you've got a good 21 months to work hard on this and have him ready to enjoy reception and understand what's going on.