As another reference point:

I got hit with this same three-percent fee for a purchase through Orbitz: two airline tickets from New York to the middle east on a middle-east carrier. It never occurred to me (and nothing on Orbitz mentioned) that Orbitz would not charge the total amount listed on my receipt for the tickets -- instead, Orbitz charged its service fee, and then separately passed through the charge for the airline tickets from the airline (which came up with an overseas location). Of course, Citi promptly added 3% to the total ticket cost.

I finally convinced Citi to reverse the fees (as a "one time courtesy"), but it does bother me a little bit that the Orbitz purchase page doesn't make it clear that you might get hit with foreign transaction fees if you are using a foreign carrier.