There are two issues here: First, make sure you stay on top of his medical needs. Hearing problems can put a kid behind in his communication skills. He may need some extra help from a speech and language therapist if he continues to struggle.
Regarding the crying: I think you are doing exactly the right thing. It may be that when his feelings, positive or negative, get too big for him to handle, your stepson cries to let them out. He may be one of those kids whose feelings are a little closer to the surface than other kids. This is common in a sensitive child. He’s only 3. This kind of thing usually resolves on its own if the adults stay calm.
By not making a big deal of it, you are not making it into either an effective attention seeking method or a power struggle. Going off to be by himself for a bit to gather himself is a great skill for him to learn. Stay matter-of-fact about the crying episodes and simply prompt him to take a break — just as you’ve been doing. If he doesn’t figure out how to be better at regulating his emotions over the course of the next year, you might want to have him evaluated by a child therapist to get more advice. It’s a good idea to help a kid learn to manage himself before he gets to kindergarten where the other kids might not be understanding.
I wish you well.