3 wire is typically hall effect and produce a square wave signal.

ie off/on/off/on/off/on

Voltage thresholds for that off on will depend on the sensor and it's power supply. So could be anything from 5v to 12v.

2 wire is typically magnetic and will produce a sine wave of sorts with voltage rising with speed

Your dash may only be able to accommodate one type of signal. Although you could buy a convertor thingy that would change the signal.
Jaycar do a speedo convertor kit that does that and also allows you to re-calibrate the signal too so the output pulse is +/- 100% compared to the input.