iTunes Match restarts on step 3 when trying to upload files
I encountered this problem, and it turned out that it was due to my ISP's traffic shaping. Uploading my music was saturating my upload bandwidth, and after about 5 minutes of that, my ISP would cut my connection to Apple's servers for a few minutes, causing step 3 to time out and the whole thing to restart.

I fixed the problem by setting up bandwidth throttling on my router while I was uploading my library. Setting it to about 80% of my maximum bandwidth worked well.