Per-item commerce shipping rules working but charging for same item twice
OK - I figured it out. I don't know if this is the best way to do it, but I added an action to my rule, but not as part of the Loop - just beneath it (not indented). This new action is "Subtract an amount from the unit price." For data selector I entered commerce_line_item. For amount, I entered the amount of one additional item (50 for the 50 cents in my domestic shipping example). 

So now my rule basically takes the base rate of $3, adds 50 cents for each item including the base item, so then the subtraction action removes that extra 50 cents. Hope this makes sense.