My upstairs neighbor is right.
Shader models (pixel shaders) come integrated with your video card.
If 3.0 is not supported that means you don't have pixel shader support or that U have a lower version like 1.1, 1.4 or 2.0.
You can check that in your video card panel if U want.
Buy a new video card that has pixel shader 3.0 support is the best option.
Besides that, and having my share with pixel shaders (very often! ) the first thing people ask is
Can't I download that thing?
Answer: No , U can't, that's not posible.
But , until U buy a new video card, there is a tiny program that only work in about 25% cases, that tricks your computer to think it has a certain pixel shader model, or force a lower one if U have it. It works on emulation and software render(sort-of...)
The program is called 3d analyze (ver 2.66 i think) just google it and download.
In all these years of dealing with certain peoples old video cards who wanted to play modern 3d games often don't want or don't have the money to buy a new card, 3d analyze sometimes worked. (as I said, just about 25%cases )
But U can try it yourself, because it's freeware...
The point is to run your game (the main exe) with this program, by checking a few settings...
Try it and let me know if it worked for U.
And buy a new video card as soon as U can!