Hi there and welcome to BW!
Honestly, there's no clear cut answer to why this happens, but it is common for some babies between 2-3 months to suddenly shorten their naps. Some don't consolidate their naps again until 5-6 months (6 mo is when their sleep cycle lengthes from 50/60 min to 1.5). Mine took 30-40 min naps from birth to 6 mo. It was extremely difficult, but it turns out he was a bit sensitive/sensory so he needed some sort of pressure during his jolts. Eventually I had him sleep on me and I would hug him beween cycles in order to lengthen his nap. I know, not ideal whatsoever. Swaddle would have been nice if it worked but he also hated it. We tried the one arm, etc... it didn't work.
From my experience here, shortened naps can be due to development (esp. around 3 mo) incl. growth spurts and digestive changes, routine related- overtiredness as their awake times need constant adjusting, and/or inconsistency/environment changes. The hardest part is the time and effort it takes to eliminate issues, at which point their routine needs another adjustment anyway... Enough to drive us mad, isn't it?
Here's what I would try:
Continue WTS for another 2 days. If it does not consistently work at this point, stop. You might condition him to wake earlier. If you have a gut feeling this is already happening based on Day 4 (if that's today), then stop.
Add another 20-30 min CN about 1.5-2 before bed to curb OT.
See #2. below.
1. I think you made the right call by going in at the 25 min mark. What I used to do when I did try WTS was stay in the room and helped him at the point he moved, similar to when you soothed him back to sleep.. which isn't technically WTS, but it worked for us. I did this bc I also didn't know how long he'd nap or when he'd wake. I didn't want to nudge him if I was disrupting his sleep cycle too early.
2. At this age, the sleep cycle is between 50 min and generally speaking, short naps are *usually* a sign of OT... but not always. Is his first awake time shorter than the afternoon ones? You could try putting him down 5-10 min earlier for the first nap to see if it'll help him relax. Conversely, if that doesn't work for 2 days or so, ADD another 5-10 mins to put him down. I figured out my son had longer than average awake times, but it was basically too late before I found out. I suggest trying earlier times bc we always want to rule out OT before doing anything that might cause it!
3. Usually with any routine change or methods tried, it takes 3-5 days. It all depends of course. WTS is usually done for only 2-3 days since as I mentioned before, it could condition early waking.
I really understand how frustrating this is! With everything I suggested, start with what you feel most comfortable with. Slow and steady. What I wish for you is that this is developmental and in another few days, he may surprise you and return to long naps.