Well, you are not in such a unique place. Having some time off prior to residency is fairly common. It is also common to ask if doing step 3 during this time is best/not.
If you were going into psych or OB or something along those lines I'd tell you if you have free time go ahead and do it now because you will forget a lot about general medicine as time passes by. However, if you go into IM, probably 60% of the test will be what you are already doing in your residency and you just have to brush up on the other topics a bit since the steps are heavily skewed towards medicine.
There is still a value of doing it before residency. For one, you won't have to worry about this during your residency and that can give you some peace of mind. From an intellectual point of view, I say it makes the most sense to do it before. First you have the time and your time will be more valuable to you after you start than it is now. Second, has the added benefit that whatever you study now will brush you up a bit for residency. There is no 2nd attempts to make first impressions. Third, I think step 3 is awfully similar to step 2 in content and doing them as close together make sense.
On the other hand, this is not what I did myself. I also had free time like yourself (8 months actually) and I caved to procrastination and laziness. At the end of the day It turned out well for me since I did minimal studying for step 3. The bulk of the knowledge I needed came from every day "bread and butter" internal medicine. I brushed a bit on OB/PEDs/Psych and I knew with just 1 week to polish those subjects I could easily pass.
So at the end of the day there is really no right answer. You probably want a decent score, although probably step 3 is not likely to be the deciding factor for fellowship, I don't think it will hurt to have a good one for a competitive fellowship and failing or having a bad one might hurt you. So as long as you are certain you will do reasonably well, take it whenever you are ready.
How will you know when you are ready? Take the practice tests.
As for study. USMLE all questions + cases will get you 95% there for a decent score.