Re: Transmission Over Temp Light
You are posting in the WK section, but your jeep is a WJ.
There is a transmission temperature sensor inside the transmission. It is in fact one part together with the governor pressure sensor. The temperature signal is send to the PCM (Powertrain Control Module), from where it goes to the instrument cluster. Since the light comes on with a cold transmission, i would more think of a bad contact (corroded or moisture) or a wire problem (shaved or internal break). It could eventually be a problem in the instrument cluster or the PCM.
I would start cleaning the connectors on the transmission and PCM with contact spray. (disconnect the battery before removing these connectors)