I see the error
there was an extra < in the replace code
it should be:
Replace: <h3 \1</h3>
The way this pattern works:
Search for any line starting with <p class="calibre2">
and ending with </p>
The stuff between the ( ) will be remembered, which will bring along any ID values.
the replace puts a <h3 in the spot that was the <p
that is followed by all the stuff remembered (the \1)
finally we want to end the line with a </h3> (not the <</h3> I stuttered)