The G# key on my Yamaha YFL-381 makes G# 3 too sharp. When I don't use it then it's about right. Has anyone experienced this?

If you don't press down the G# key then you would be playing a G natural. Sorry, I guess I am a bit confused..

Its common to play the most of the 3rd octave sharp - which gives the flute more penetration and is fashionable. However, this shouldn't be anything like a semi-tone sharp (+10 is probably more than enough). On a couple of my flutes G#3 is intrinsically flat and I have to change my embouchure to keep it in tune. Without playing your flute and hearing you play its difficult to be sure but my instinct is that you can (and should) adjust your embouchure to get G#3 in tune. You probably already know that when playing in an ensemble keeping the third octave in tune is one of the challenges.

angle the air lower, sometimes you can put finger 4-5 down on the right hand as well, if you can play G# without pushing the G# key, we all want to know how to do that...

Its common to play the most of the 3rd octave sharp - which gives the flute more penetration and is fashionable. However, this shouldn't be anything like a semi-tone sharp (+10 is probably more than enough). On a couple of my flutes G#3 is intrinsically flat and I have to change my embouchure to keep it in tune. Without playing your flute and hearing you play its difficult to be sure but my instinct is that you can (and should) adjust your embouchure to get G#3 in tune. You probably already know that when playing in an ensemble keeping the third octave in tune is one of the challenges.

I think it's the way I'm playing it because sometimes I can play it in tune.

do you mean fingers 5-6 patrick? RH middle and ring fingers, right? I don't know what your numbering system is. lol