Showing Excerpts from a Specific Category

Hello Everyone,

Now I know various ways of showing post excerpts from a specific category, the problem is that I’m using the following loop code for the home page and it works perfectly and shows post excerpts from all categories in the home page, all I’ve to do is add <!–more–> in the content and the section till there is shown as an excerpt but the problem is that I created a ‘template page’ for ‘WordPress Blog’ and I want to display all post excerpts from ‘wordpress’ category under this ‘WordPress Blog’ page, so I used the same loop code and added (cat=3) to display the post excerpts but the page shows entire content and not just the excerpts, basically I would appreciate it if someone could explain to me why this code works perfectly when no category is added and shows the entire content when category is added or is there something else I’m missing here.

PS:- I know I can replace ‘the_content’ with ‘the_excerpt’ to show excerpts but this doesn’t show the ‘Read More’ link.

The code is here
http://pastebin.com/Aee5ANDg