Ok, so here's the deal, layer 3 is the Network layer of the OSI model. Essentially they deal with incomming packets. Now, DHCP is seen as an application layer protocol (layer 7 of the model) and also DNS. Now both of them work with IP addressing and without IP addresses and DNS, the transfer of data would be non-existent. They DO fall under 'application' but can you also make a case for them being a layer 3 protocol too?