That model usually came with a 270MB Drive, or thereabouts. The System dates to around 1994, which means it may be limited to a maximum HDD size of 528MB. However as the workarounds that changed the limit to 2.1GB up through 1996 were introduced in 1994 it's possible it could accept a larger Drive. 3GB is pretty certain to exceed the BIOS capabilities, however. FRor what you're doing a CompactFlash Adapter would work pretty well. You can get 512MB or 256MB CF cards dirt cheap or even in bulk, and swap them into an adapter fairly easily.
Getting Windows 2000 on a 486 may require some workarounds (disabling L2 cache, etc.) depending on the system. Look forward to waiting around 2 to 3 hours for it to complete the initial "Copying files" steps, as well.