Hi,
SoO is required with BGP when you also configured as-override. In this case the AS PATH can't be used anymore to detect loop so you need something else to identify from where this path is coming from.
In usual case, PE3 will send the update to CE2 which will drop it as it sees its own AS in the AS-PATH. With as-override, CE2 is not seeing its own AS anymore.
PE3 will still prefer its eBGP route from CE2 regardless if you configured SoO or not.
HTH
Laurent.