I have never had a problem moving large SQL files.
3.5mb is not very large. I wonder if you are running into the compatibility issue with different versions of MySQL.
Are you using an old version of MySQL on one of the servers? If remember correctly, some of the file parameters changed around version 4.1.
I once had a problem restoring an old SQL file and I had to manually change some of the parameters in the SQL file to get past the errors. The errors were coming from some of the MySQL parameters tagged on to the end of the CREATE TABLE command.
"It's inexcusable for scientists to torture animals; let them make their experiments on journalists and politicians." -Henrik Ibsen