The solution of the coupled-wave equations for second-harmonic generation in a near-resonant three-level system is extended to include absorption. It is shown, within second-order perturbation theory, that double resonance is the optimal conversion condition, despite absorption enhancement. We extend the solution numerically, using nonperturbative susceptibilities derived within the rotating-wave approximation, to saturating intensities and discuss the modifications to the perturbative conclusions as well as the regimes of validity for the various approximations.