Here's my opinion on this.............. you could be running rich.
What 'may' be happening is that as the bike gets warmer from slow running, it keeps getting richer. The richer it gets, the more extreme the carbs get in running rich. It's a vicious cycle. Then when hot enough, the bike runs like crap until you get moving and get that temperature back down again.
Good thing to check..........
Start with the bike when fully warmed up, and just when you start to run a bit warmer than normal highway runs and come to a stop, blip the throttle when fully stopped. If the idle dips down a bit right after the throttle blip, you're rich. The idle should come right back to where it was and not hang up higher for a bit (would indicate lean) and not dip down (which indicates rich).
If it dips way down, then you're very rich and would explain the faster rate of heating up and also would be the reason for the very poor running when hot.
I've had my bike in traffic and the temp needle climbs, but the bike runs the same. I used to have the 'throttle blip dip' when I was running too rich at idle. After correcting that issue (many, many, years ago), I've never had traffic idling issues.
One more thing to check............
When you first start the bike from cold, can you immediately run without the choke? If so, you're probably rich. The bike when cold should need just a bit of choke. If it runs too smoothly when still cold, that means that it's running rich. I mean obviously the bike should run perfectly when warmed up fully and not be perfectly carbureted when still cold, or it's the equivalent of running with the choke on.
This is the thing; running too lean can lead to hot running, but also running way rich will lead to heating up also. Usually it's the lean running causing overheating, but running too rich will leave unburned fuel in the exhaust and combustion chambers and can cause hot running.
When the bike is idling, does the exhaust stink of unburned fuel? Are the exhaust tips sooty black? Does the bike smoke when warmed up and idling?
Check all that and let us know before we start diagnosing the cooling system.
Even if you have some cooling issues, the bike should not run too badly when getting a bit warm. You did say it gets hot but not 'needle in the extreme red' kind of hot, and that's why I'm thinking carb/jetting issues are the culprit.
Vinnie