I'd fold preflop. Villain is too tight passive to be 3-betting hands that KQ can beat or is even money with. This just isn't a profitable situation, even with MP3's money in there.

First flop raise is good as it will help you know whether villain is on big overs or a big pair. When he 3-bets the flop, the extremely passive player has let you know twice now that he's got something big, so almost always purely on the OESD (unless he has QQ). The cap is a mistake because your overcard outs are no good, and an OESD (with possibly two dirty outs, considering MP3's line so far) doesn't have an equity edge against only two opponents.

Once the board pairs on the turn, the SB checks suspiciously after showing a bunch of PF and flop aggression, and MP3 donks, the case for continuing is very slim. I doubt that even cleanly completing an OESD gives you the best hand often enough even with the large pot odds.

SB's C/R on the turn makes the pot so big on the river that a nut straight has to call hoping SB just got drunk recently.