Best way to go about these shipping options?

I have been playing around with the shipping modules quite a bit and was just wondering the best way to go about the following shipping options:

I would like to have Ground and Priority Shipping options.
I want the Ground shipping to be $2.50 per item for 1-2 items, And then Free for 3 or more items.
I want the Priority to be just $4.00 per item.

I was having a little trouble getting it to show up exactly how I wanted, so I was just curious of the best way to go about this. Maybe I was just doing something incorrectly, but when I enabled free shipping for 3 or more items, the 2.50 per item option still shows up -- I need that to go away when there are 3 or more items.

Thanks!