You HAVE to tell him. Be calm about it. Before something big happens, we explain everything to our kids (one at a time) and then it gives them time to process it and since we have no fear surrounding it, they don't either. It gives them timr to ask questions, etc. They are basically little adults. I don't think you'd like someone waking you up and driving you somewhere and springing something like surgery on you.
When I was pregnant with #2, we explained the entire labor and birth. It took him months and I thought I had explained everything perfectly. He was fine watching his brother born at home and afterwatd the ONLY question I got was, "Why did you have that thing in your nose?" I had oxygen because I was so tired and it gave me a little more energy to focus and get through the long labor. No other questions. In fact, with baby #3, he cut the cord at 5 years old and was fine with everything.
Preparation/education is the key to trust and it releases fear.
I find that using certain YouTube is helpful for the visual aspect of things. They are not exactly always something that a 3-year old needs, but even if it is not, you can watchit so you can fully understand it, so it can ge explained age-sepcifically. Not sure if it's an inguinal ro umbilical, but I found both for you.
This is for an inguinal hernia:
http://www.youtube.com/watch?v=R6pwlIVQPVA
This is for an umbilical hernia:
http://www.youtube.com/watch?v=PGzKTQ25iuE
http://www.youtube.com/watch?v=WaVTXZzpk1Y