The G3 has a wider and better selection of parts, a better rear sight and "normal" trigger group. Down is fire, up is safe. It costs more than a basic CETME and the front sight is a rectangular post, the CETME's front sight tapers to a point. Otherwise, there aren't any other differences I am aware of. The G3 uses the stamped receiver but it is no different from the stamped CETME receiver(CETME is something of a misnomer, it uses a G3 receiver).
I can't say if the G3 line is better than the CETME, quality wise. Regardless, I would look before I bought. Check the bolt gap(Let the charging handle fly, full force, pull the trigger and insert a feeler gauge into the gap between the bolt head and the bolt body. It should be .05-.20 inches), the bolt itself for grinding and the rollers to make sure they're standard. CAI made some over-sized rollers, with typical CAI quality. You can tell because the rollers look like they were made by a two year old.
As for other alternatives, Ohio Rapid Fire used to offer a G3 clone for about the price CAI offers theirs. Supposed to be a nice product but the owner of Special Weapons(who made the receivers) had a tantrum and cut them off, from what I hear. JLD makes the PTR-91, which retails at around $700 normally. It uses a French rear sight(It has aperture sights for all the sight ranges, rather than the open sights for 100 and aperture to 400. I don't like it, YMMV), the best US made furniture I've seen yet, and a heavy target barrel(but without the other accuracy improvements of the MSG90). The receivers they use are some of the best currently manufactured, made on FMP tooling.
Or you could make your own.
FAC still has FMP kits for 200, plus PTR receiver for the same. Find someone to build it, like
IGF, and you add another 200 or so.