"I'm trying to figure out how to make this work for my 3 year old. He is very high spirited, very defiant and REALLY can't take no for an answer. I struggle minute to minute with obedience and with whining and I worry that if I did things the same way I do them with my older children, only using time-outs, he would be in time-out constantly. Actually I don't know if he would ever make it into time out if I waited for him to be calm first. I guess my question is just that I need some words of advice for my 3 yo."
Take him there every time, even if it seems he is there a lot for a few days. You must be consistent. Teach to everything! Also, he doesn't need to be calm to go to time-out. Time-out should be the trigger place for him to change his heart and behavior. After he has calmed down, praise him and then teach and practice what should have been done. If you calmly take him by the had there every time he acts out, after a day or two of this consistency, you should notice change. If he is especially stubborn, it could take longer. The only way to FREE him from his anxiety and unhappiness, is to consistently teach to it EVERY time it happens. Time-out is a great place to get calm, so that he is ready to talk.