TP2K, Second Nut Flush Draw, Too Passive?

[SnakeRat]

Both of my opponents are loose passive typical.

Party Poker 2/4 Hold'em (10 handed)

Preflop: Hero is MP1 with K[img]/images/graemlins/diamond.gif[/img], Q[img]/images/graemlins/heart.gif[/img]. CO posts a blind of $2.
<font color="666666">3 folds</font>, <font color="CC3333">Hero raises</font>, MP2 calls, <font color="666666">1 fold</font>, CO (poster) calls, Button calls, SB calls, <font color="666666">1 fold</font>,

Flop: (11 SB) K[img]/images/graemlins/heart.gif[/img], 6[img]/images/graemlins/heart.gif[/img], 7[img]/images/graemlins/heart.gif[/img] <font color="blue">(5 players)</font>
SB checks, Hero checks, MP2 checks, CO checks, <font color="CC3333">Button bets</font>, SB calls, <font color="CC3333">Hero raises</font>, MP2 folds, CO folds, <font color="CC3333">Button 3-bets</font>, <font color="CC3333">SB caps</font>, Hero calls, Button calls.

SB called then capped, to me that says flush or set. Now I am stuck with a bit of an awkward second best type of hand, with a draw that could be good.

Turn: (11.50 BB) 2[img]/images/graemlins/spade.gif[/img] <font color="blue">(3 players)</font>
<font color="CC3333">SB bets</font>, Hero calls, Button calls.

Presumably he would 3-bet a flush here so I just call and hope for a heart given the size of the pot. Should I raise?

River: (14.50 BB) 8[img]/images/graemlins/heart.gif[/img] <font color="blue">(3 players)</font>
<font color="CC3333">SB bets</font>, Hero calls, Button calls.

Ok 4 hearts on the board and he is still betting, I go for an overcall.

Final Pot: 17.50 BB

What do you think of my play?

As a tangent I am in the midst of a 90 BB slide during the past week.
I think it is normal variance based on how many times I have been rivered or ran into monster hands.
Whats the biggest slides you guys have had?