Why does heat problems cause purple tint / pink spots on my camera (HTC One)? A while ago, I got a new HTC One m7, It is the best phone I've had, but it has one BIG issue, its camera sucks on low light.

I've investigated the issue, and I was told it could be alleviated with a software update, and it's been almost a year, and nothing.

The problem is in fact a hardware issue, where heat causes something on the camera, so it adds this annoying purple stripes/haze: Stripes Image, Tint image. And this hardware issue comes, apparently because there is a lot of strain on a chip (Zoe?).

Photos taken with flash look extremely good though. So my question is...
Why does this happen?

I'm not looking to know what causes the phone to heat up. I'm asking why would purple tint/stripes appear there.
What is happening to the lens? or... is affecting the image processor chip? if so, in what way?
Or... is it caused by something else?
And... How come it does not affect my flash-taken-photos?
The HTC One's camera has bigger pixels than the regular phone cameras ("Ultrapixels"). When you use your camera in low light, it tries to draw more light from the sensor, so the image looks brighter.

The "purple" issue is caused by bad heat insulation of the camera sensor from the rest of the phone, so when you try to take a photo the heat can cause distortion of the data the image processor chip collects from the sensor and converts to digital image (when you open the camera app it puts the screen brightness to max, so even this can cause the phone to heat up). When you use the camera in low light the image chip relies more on the sensor to collect more light, so this might cause only low light pictures to be affected (especially the color black, where the sensor tries to deliver as much light possible and there just isn't one, as it is dark). When you take a photo in normal light (or with flash) there is enough light and the sensor doesn't try to replace the color black with purple.

The damage to the camera sensor caused by heat seems to be permanent and if it's in an early stage it can be fixed by a software update which just calibrates the image chip to ignore the "purple" image data. But, as you stated, this is a hardware issue and if the software update doesn't fix it, the phone should be sent to a repair center for the sensor and the insulator around it to be replaced. As of November - December 2013 the new sensors are made by a different manufacturer and lack the issue.

Source: the forum thread at xda: http://forum.xda-developers.com/showthread.php?t=2317507
and personal experience with my HTC One M7.