My car has done this but only when I expected it. I was on an empty stretch of highway and was wondering what the car would do if I would say pass out or something. So I took my hands of the wheel with Adaptive cruise on, lane keep assist, and ELK. Within a few seconds it gently reminds me to hold the steering wheel, while still keeping the car in the centre of the lane. After a few more seconds I get the red warning you described above.
I was quite surprised to notice the lane keep assist then turns off, so the car started "bouncing" between the lines on ELK, but the cruise control maintained the set speed. After three ELK interventions (which are quite jolting) I decided I'd seen enough, but it did leave me wondering what would happen in reality, do I bounce around until I hit something? It is interesting to see your cruise control turned itself off, which is a behaviour I would expect in my scenario. Although off course not a good thing in your scenario.
I believe the car realises when you're not holding the wheel because you don't make tiny motions, as it also once warned me when I only had one hand lightly on the bottom of the wheel. Perhaps you have some sort of broken sensor? Or like you said a software glitch.