the third level of my menu doesn\'t show up when hovering the 2nd level. I know that this is because overflow:hidden is styled on the 2nd level ul
overflow:hidden
ul
Add overflow:visible when hovering over the ul element. In doing so, the transition will still take place because the overflow is hidden prior to hovering over the element.
overflow:visible
Updated Example
#menu ul li > ul:hover { overflow:visible; }