After recently looking into this one further, the manual states the following regarding this caution:

"Autopilot (AUTO PILOT) Light:

Illuminated (amber) -
- a degraded operating condition exists in engaged autopilot" (part 2, page 97)

and

"Message: AUTOPILOT, Level: Caution, Light: AUTO PILOT, Aural: Beeper
Condition: The engaged autopilot is operating in a degraded mode.
Engaged roll and/or pitch mode may have failed." (part 2, page 115)

The message is appearing during a manual intervention of ILS Autoland after disconnecting the autopilot with MCP APP mode selected, and the autopilot is no longer engaged as per the conditions for the caution.

Is a hotfix possible to improve this for FSX 1.503?