It's closer to the APP than it is to how I remember the AP1. It sounds like the APP with a slight mid-bass focus (a little more punch/boom), but I haven't listened to my APP analytically in a while, so do take what I say with a grain of salt. It's also less warm and smooth than the APP as well. I still get a V-shaped signature to it, but not nearly as strong as I remember the AP1 while the APP has always sounded warm over neutral to my ears.
As for outside noise getting in, it does like it would with any earbud-style design. I didn't find it interfering with my music as much, though there were certain frequencies that liked to echo a bit, but that can also be adjusted with fitment. To explain better, I'm going to have to define a new term, let's call it angle of attack which would be defined as the angle in which the opening of the AP3 points towards the ear canal. You can angle it inward/forward by rotating the AP3 such that they point more towards the center of your head (I'll refer to this as a higher/greater angle of attack) or angle them outward/back (I'll refer to this as a lower angle of attack). Please see my crude figure depicting this. Note that as you go to a low angle of attack, you'll end up with the AP moving physically further from the ear canal as well with an air gap between the canal and the AP. With a high angle of attack, the earbud is more or less shoved into my ear canal. For whatever reason, I found a high angle of attack to be much more secure in my ears. As we'll see in a bit, a low angle of attack is likely how Apple intended the headphones to be worn.
With a higher angle of attack, higher frequencies tend to "echo" or be amplified just a few decibels louder than they should be. This also includes your breathing as well. However, outside this frequency range, the earbuds do "isolate" better. The higher frequency portion of my steps can also be heard. With a lower angle of attack, this "echo" effect is gone so you that amplification effect is gone, as is the breathing sounds (I forgot to listen for my steps unfortunately so I can't comment there). However, this lower angle of attack also does let more background noise in, though I'll admit it's pretty minor.
Note that I naturally preferred to wear my headphones with a higher angle of attack, AP1 included. With the AP3, this puts the stem at a weird angle where I have to rotate my wrist a little more to grab it. If I use a lower angle of attack, the stem is a lot more natural to grab, which leads me to believe that the AP in general are designed to be worn with a lower angle of attack.
While I'm on the subject of angle of attack, let's quickly go over the weirdness of the AP1. With a high angle of attack, the SQ gets a very bassy and quite ugly, with a low angle of attack the bass body and presence is almost completely lost.
Edit: note that with the AP3, the effect from angle of attack is more or less gone due to the AdaptiveEQ. The system works quite well.
Edit 2: These types of fitment effects are expected and can vary the way a headphone sounds. Even with over-ear headphones, the location of the headphone on the measurement dummy (or the listening person) can alter it's frequency response. With IEMs, the distance in which the IEM is inserted into the ear canal can have measurable differences in sound. With earbuds, how the earbud is placed on the head can have effects on the SQ. This is one area where there is variation in EQ. However, I do feel like earbuds do serve a bigger hurdle with measurement since they can be altered quite a bit by doing this, moreso than IEMs (assuming a seal is present) or headphones. This is likely why there are some measurements of the AP1/2 where there is a strong mid-bass bump (like the one I had linked to earlier) while others show none.