What a shame! I took a large set to the charity shop last week. I had no idea they were so expensive: they were hand-me-downs. They went under the name "Takasima" but it looks like the same stuff. My younger daughter, who likes building toys, quite enjoyed it but we always had an issue with how much space it took up in our small house. It's totally indestructible and easy for a very young toddler to manipulate.
Here are other things dd has liked. Unfortunately they aren't cheap either:
Gear set: www.quercettistore.com/en/products/georellotech The set above which allows/requires you to build upward has more interesting components, but the set which affixes directly to a baseboard is the only one your 3yo would manage without frustration: www.amazon.co.uk/Quercetti-QA2341-Georello-Kaleidogears-55pc/dp/B00000J048
Magnetic building toy: www.geomagworld.com/eng/ The Geomag brand has very powerful magnets, allowing you to do things with it which you can't do with similar cheaper versions. Sadly, the little starter sets don't have enough pieces to do much at all. You have to spend £30 or so. All visitors to our house, of any age, have fiddled with it, usually for quite a long time. I would guess this is a great toy for anyone who needs to develop hand strength - the magnets are so strong that if you aren't used to it, your hands ache after playing with it! The range of ways in which you can use it is astonishing. We've had it for ten years and it is still in almost daily use.
Here's something rather cheaper, a make-your-own-clock set: www.amazon.co.uk/Make-Your-Own-CLOCK-Kit/dp/B0039ZMZGK It takes some patience but you and your 7yo could do it together. Fascinating. It is a bit of a one-trick pony though, so you'll want to pass it on to a friend when you're done.
What about an ant farm, butterfly garden or flower press?
Car boot sales have provided most of our best toys. I like the fact that you never know what you're going to find next. An old manual typewriter, a printing set, a bagatelle. At a pound or two, if it doesn't hit the mark then you can pass it on without too much regret.