Making Terminal bash auto-complete stop at ambiguous character and display all possible options
Thanks to comment from mtklr. Many web pages that talk about Mac OS X Terminal auto-complete asks you to add the 3 lines I mention in my question. But if you want behavior as on say Ubuntu, you need just the first 2 lines:
set completion-ignore-case on
set show-all-if-ambiguous on 

Do not add TAB: menu-complete