Guernsey Stinker

ARRIVED on Friday for my 19th Guernsey Chess Festival, but unfortunately I was already developing a stinking cold.
The tournament began yesterday, so three of us used the spare day on Saturday to catch a boat to Herm.
I knew the island was supposed to be beautiful, but I was surprised at just how beautiful.

View from Herm, looking back to Guernsey

A day of almost non-stop sunshine helped enormously, but for me it was the second day of having a terribly sore throat.
The cold broke yesterday, but even so I reached the following position in my round-one game.

Spanton (1858) - David Collier (2015), after Black's 34th move

White is a pawn up, but under pressure on the kingside. My priority was to drive away the black knight, but how is this best achieved?
I was torn between playing g3 (trying to take advantage of the unprotected status of the f7-rook), and first consolidating with Nd3.
In the end I settled for 35.g3?? and could have resigned immediately after DC's reply 35...fxg3. What made it especially annoying was that I had seen this idea in another variation.
Komodo9 gives 35.Nd3 h5 36.gxh5 Qxh5 37.Ne1, with a large advantage to White.
Stockfish8 is not so convinced by this line, reckoning Black has fair compensation for the pawn.
Either way, 35.Nd3 was the better choice ...