When I was inspecting my ATV for fluid in all those drain tubes, I noticed that on coming down near the engine (it has a plug on it) had a reddish fluid in it (only a couple inches). It appears to be transmission fluid.

Is this an overflow, or is this an indication of a problem?

Thanks.

 

Is the drain tube coming out of your air box? You don't have transmission fluid in your motor. At least I hope not. More than likely it's filter oil that seeped out of the filter. This is normal, that is what the drain tube is for. Take the cap off and drain it then clean your airbox out. You may be using too much oil on your filter.
If the tube is comming from somewhere else you can disregard this.
If it has a cap on it it's an overflow and it's doing its job. If the tube continues to fill up after draining it then you probably have a problem wherever it is coming from.