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I applied to law school for the fall and wasn't happy with the schools I got accepted to. I want to retake the LSAT for the 3rd time and get some work experience to increase my chances at a better school.

1. Is it okay to take the LSAT 3 times if there is a significant difference in my original score?

2. What could I do in my year off? I am considering taking paralegal courses or clerkships.

What can I do to make myself a better JD applicant?

You have kind of answered your own questions. Yes you can retake. Yes working is good. Apply early and that's pretty much it.