The language is a little ambiguous. It seems it's meant to suggest that having a folding pocket knife with a blade less than 3 inches is allowed, but that is not actually said, only implied by contrast to the explicit statement that folding blades longer than 3" are prohibited. In a regulatory environment like the current UK, I don't like those kinds of rights being only ambiguously implied.
The guidelines go on to say that butter knives with no cutting edge and no points are considered prohibited blades under the law, which is ridiculous, and that folding pocket knives with blades less than 3" are not considered folding if they lock open (because they are not "immediately foldable"), and are therefore prohibited. Which is, again, ridiculous, and also undoubtedly leads to many unnecessary injuries as unlocking blades close on the fingers of their users.
Does that still mean you can carry a short pocket knife (one that fits in your pocket is unlikely to be long, in any case)?