Block 3 doesn't include the weapon pod and even if it's true that it adds new techs, it falls by far short wrt EW. That's why the US is selling EW capabilities that Rafale and EF show for a decade, as NG in the F35.
Other than that it also falls clearly short in flight performance and that was a deal breaker in the original MMRCA for sure, which is why Boeing/GE tried to get the EPE in as a last minute solution. However MMRCA 2.0 might have different priorities, let alone the Indian government.
Wrt weapons, the F18 has the better variety, especially in the A2G field, but not necessarily the better once. The AAMs can't compete with European counterparts anymore, which is why more and more Teen customers switch to them. AASM is known to be more precise and capable than JDAM, Scalp has no comparison in the US weapon pack, that would be available to India. But here again, costs are an advantage! Nearly any Rafale weapon is clearly costlier than US weapons and history showed us, that having a limited variety of costly French bombs, could be a problem in war times, which is probably one reason for IAF to add Israeli weapons to Mirage and Rafale.
There was a clear tech and capability difference between F18 and Rafale in the original MMRCA, now it got closer and cost as well as politics can change the game too.