It doesn’t really matter whether this is a common problem or not, a malfunctioning camera is a major safety issue as it means critical safety systems in your car are not working. This is a major safety issue and one that has legality and insurance ramifications in the right (or wrong) circumstances.
It’s worth mentioning that this model ASX was recalled to attend to a software issue that could cause some safety features (including the ones you’ve listed) to not work properly. Your car also falls within the manufacturing dates of affected vehicles. Perhaps that’s the clue you need to solve this. A check with a Mitsubishi dealer will reveal whether your car was affected and if it’s been fixed.
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It sounds like there’s something pretty major wrong inside the transmission. The lack of drive in reverse is allowing the engine to 'flare' (rev up) because there’s no load on the engine when this happens.
But before you do anything else, check the level of transmission fluid in the gearbox to make sure it’s not low. A low fluid level can cause these symptoms, too, so you need to rule out the easy stuff first.
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If the warning is being shown when the engine is first started (and therefore, patently not overheating) the fault is likely to be with an engine sensor that tells the computer the engine temperature. This model is known for this fault.
However, if the engine really is overheating, the possible causes are many and could be a stuck thermostat, a blocked radiator, a leak in the cooling system, a failed EGR valve, a failing water pump, or perhaps even something less obvious like a blown head gasket.
So the first step is to determine whether the engine really is overheating or not and go from there. An experienced mechanic will tackle each possibility in turn, but make sure they’re aware of the sensor problem with this model.
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