There is a great book called It's Not The Stork which might be just what you need. It's written for ages 4 and up, but 3 is close to that. It explains everything in an empowering and positive way that kids understand. It is part of a series that is liberal minded about things like sexuality, including same-sex couples, so that might either be a selling point or scare you off depending on your mindset. But we've had the whole series here and I just keep the books in my older daughter's room so she can read up on stuff she has questions about as she gets curious. (The other ones, for higher age groups,are It's So Amazing, and It's Perfectly Normal.)
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