The conversion would be slightly greater the 2.5 inches by slightly greater the 3.5 inches for the dimensions that you quoted. The problem that I see using the format size that you mentioned is film flatness and film registration in correspondence to the viewing mechanism. I would be more inclined to check out cutting down 5X7 film. If it works out each sheet would give you four sheets of the format that you have. I would check to see what the dimension standards are for 5X7 format before I got too far along with that idea though. Since the actual 5X7 film dimensions will be slightly less then the commonly quoted dimension.
Another thought would be to contact Photo Warehouse as they will cut film to your dimension. I believe that Midwest Photo is now offering the same service. However, I noted that Midwest Photo's pricing was more expensive then Photo Warehouse.